Title of each class
|
Name of each exchange on which registered
|
Common Stock, $0.01 par value
|
New York Stock Exchange
|
Preferred Stock Purchase Rights
|
New York Stock Exchange
|
8.875% Series B Cumulative Redeemable Perpetual Preferred Shares, $0.01 par value
|
New York Stock Exchange
|
8.500% Senior Notes due 2020
|
New York Stock Exchange
|
Large accelerated filer ☐
|
Accelerated filer ☒ Non-accelerated filer ☐
|
U.S. GAAP ☒
|
International Financial Reporting Standards as issued ☐ Other ☐
|
by the International Accounting Standards Board | |
FORWARD-LOOKING STATEMENTS
|
4
|
|
PART I
|
||
Item 1.
|
Identity of Directors, Senior Management and Advisers
|
5
|
Item 2.
|
Offer Statistics and Expected Timetable
|
5
|
Item 3.
|
Key Information
|
5
|
Item 4.
|
Information on the Company
|
29
|
Item 4A.
|
Unresolved Staff Comments
|
48
|
Item 5.
|
Operating and Financial Review and Prospects
|
48
|
Item 6.
|
Directors, Senior Management and Employees
|
65
|
Item 7.
|
Major Shareholders and Related Party Transactions
|
69
|
Item 8.
|
Financial Information
|
71
|
Item 9.
|
The Offer and Listing
|
72
|
Item 10.
|
Additional Information
|
73
|
Item 11.
|
Quantitative and Qualitative Disclosures about Market Risk
|
81
|
Item 12.
|
Description of Securities Other than Equity Securities
|
81
|
PART II
|
||
Item 13.
|
Defaults, Dividend Arrearages and Delinquencies
|
82
|
Item 14.
|
Material Modifications to the Rights of Security Holders and Use of Proceeds
|
82
|
Item 15.
|
Controls and Procedures
|
82
|
Item 16A.
|
Audit Committee Financial Expert
|
83
|
Item 16B.
|
Code of Ethics
|
83
|
Item 16C.
|
Principal Accountant Fees and Services
|
83
|
Item 16D.
|
Exemptions from the Listing Standards for Audit Committees
|
84
|
Item 16E.
|
Purchases of Equity Securities by the Issuer and Affiliated Purchasers
|
84
|
Item 16F.
|
Change in Registrant's Certifying Accountant
|
84
|
Item 16G.
|
Corporate Governance
|
84
|
Item 16H.
|
Mine Safety Disclosure
|
84
|
PART III
|
||
Item 17.
|
Financial Statements
|
85
|
Item 18.
|
Financial Statements
|
85
|
Item 19.
|
Exhibits
|
85
|
|
As of and for the
|
|||||||||||||||||||
|
Year Ended December 31,
|
|||||||||||||||||||
|
2016
|
2015
|
2014
|
2013
|
2012
|
|||||||||||||||
|
(in thousands of U.S. dollars,
|
|||||||||||||||||||
|
except for share and per share data, fleet data and average daily results)
|
|||||||||||||||||||
Statement of Operations Data:
|
||||||||||||||||||||
Time charter revenues
|
$
|
114,259
|
$
|
157,712
|
$
|
175,576
|
$
|
164,005
|
$
|
220,785
|
||||||||||
Other revenues
|
-
|
-
|
-
|
447
|
2,447
|
|||||||||||||||
Voyage expenses
|
13,826
|
15,528
|
10,665
|
8,119
|
8,274
|
|||||||||||||||
Vessel operating expenses
|
85,955
|
88,272
|
86,923
|
77,211
|
66,293
|
|||||||||||||||
Depreciation and amortization of deferred charges
|
81,578
|
76,333
|
70,503
|
64,741
|
62,010
|
|||||||||||||||
General and administrative expenses
|
25,510
|
25,335
|
26,217
|
23,724
|
24,913
|
|||||||||||||||
Management fees to related party
|
1,464
|
405
|
-
|
-
|
-
|
|||||||||||||||
Gain on contract termination
|
(5,500
|
)
|
-
|
-
|
-
|
-
|
||||||||||||||
Foreign currency gain
|
(253
|
)
|
(984
|
)
|
(528
|
)
|
(690
|
)
|
(1,374
|
)
|
||||||||||
Operating income / (loss)
|
(88,321
|
)
|
(47,177
|
)
|
(18,204
|
)
|
(8,653
|
)
|
63,116
|
|||||||||||
Interest and finance costs
|
(21,949
|
)
|
(15,555
|
)
|
(8,427
|
)
|
(8,140
|
)
|
(7,618
|
)
|
||||||||||
Interest and other income
|
2,410
|
3,152
|
3,627
|
1,800
|
1,432
|
|||||||||||||||
Gain / (loss) from derivative instruments
|
-
|
-
|
68
|
(118
|
)
|
(518
|
)
|
|||||||||||||
Gain / (loss) from equity method investments
|
(56,377
|
)
|
(5,133
|
)
|
12,668
|
(6,094
|
)
|
(1,773
|
)
|
|||||||||||
Net income / (loss)
|
$
|
(164,237
|
)
|
$
|
(64,713
|
)
|
$
|
(10,268
|
)
|
$
|
(21,205
|
)
|
$
|
54,639
|
||||||
Dividends on series B preferred shares
|
$
|
(5,769
|
)
|
$
|
(5,769
|
)
|
$
|
(5,080
|
)
|
$
|
-
|
$
|
-
|
|||||||
Net income / (loss) attributed to common stockholders
|
$
|
(170,006
|
)
|
$
|
(70,482
|
)
|
$
|
(15,348
|
)
|
$
|
(21,205
|
)
|
$
|
54,639
|
||||||
Earnings / (loss) per common share, basic and diluted
|
$
|
(2.11
|
)
|
$
|
(0.89
|
)
|
$
|
(0.19
|
)
|
$
|
(0.26
|
)
|
$
|
0.67
|
||||||
Weighted average number of common shares, basic and diluted
|
80,441,517
|
79,518,009
|
81,292,290
|
81,328,390
|
81,083,485
|
Balance Sheet Data:
|
||||||||||||||||||||
Cash and cash equivalents*
|
$
|
98,142
|
$
|
171,718
|
$
|
199,401
|
$
|
222,633
|
$
|
431,624
|
||||||||||
Compensating cash balance*
|
23,000
|
21,500
|
19,500
|
18,000
|
15,000
|
|||||||||||||||
Total current assets*
|
115,316
|
193,513
|
218,734
|
233,868
|
451,986
|
|||||||||||||||
Vessels' net book value
|
1,403,912
|
1,440,803
|
1,373,133
|
1,320,375
|
1,211,138
|
|||||||||||||||
Property and equipment, net
|
23,114
|
23,489
|
23,887
|
22,826
|
22,774
|
|||||||||||||||
Total assets
|
1,668,663
|
1,836,965
|
1,787,122
|
1,701,981
|
1,742,802
|
|||||||||||||||
Total current liabilities
|
78,225
|
58,889
|
98,092
|
62,297
|
61,477
|
|||||||||||||||
Long-term debt (including current portion), net of deferred financing costs
|
598,181
|
600,071
|
484,256
|
431,557
|
459,112
|
|||||||||||||||
Total stockholders' equity
|
1,056,589
|
1,218,366
|
1,282,226
|
1,253,392
|
1,266,424
|
|||||||||||||||
|
||||||||||||||||||||
* Comparative amounts have been reclassified to present compensating cash balance in a separate line
|
Fleet Data:
|
||||||||||||||||||||
Average number of vessels (1)
|
45.2
|
40.8
|
37.9
|
33.0
|
27.6
|
|||||||||||||||
Number of vessels at year-end
|
46.0
|
43.0
|
39.0
|
36.0
|
30.0
|
|||||||||||||||
Weighted average age of vessels at year-end (in years)
|
8.2
|
7.4
|
7.1
|
6.6
|
6.0
|
|||||||||||||||
|
As of and for the
|
||||||||||||||||||||
Year Ended December 31,
|
||||||||||||||||||||
2016
|
2015
|
2014
|
2013
|
2012
|
||||||||||||||||
Ownership days (2)
|
16,542
|
14,900
|
13,822
|
12,049
|
10,119
|
|||||||||||||||
Available days (3)
|
16,447
|
14,600
|
13,650
|
12,029
|
9,998
|
|||||||||||||||
Operating days (4)
|
16,354
|
14,492
|
13,564
|
11,944
|
9,865
|
|||||||||||||||
Fleet utilization (5)
|
99.4
|
%
|
99.3
|
%
|
99.4
|
%
|
99.3
|
%
|
98.7
|
%
|
Average Daily Results:
|
||||||||||||||||||||
Time charter equivalent (TCE) rate (6)
|
$
|
6,106
|
$
|
9,739
|
$
|
12,081
|
$
|
12,959
|
$
|
21,255
|
||||||||||
Daily vessel operating expenses (7)
|
5,196
|
5,924
|
6,289
|
6,408
|
6,551
|
(1) |
Average number of vessels is the number of vessels that constituted our fleet for the relevant period, as measured by the sum of the number of days each vessel was a part of our fleet during the period divided by the number of calendar days in the period.
|
(2) |
Ownership days are the aggregate number of days in a period during which each vessel in our fleet has been owned by us. Ownership days are an indicator of the size of our fleet over a period and affect both the amount of revenues and the amount of expenses that we record during a period.
|
(3) |
Available days are the number of our ownership days less the aggregate number of days that our vessels are off-hire due to scheduled repairs or repairs under guarantee, vessel upgrades or special surveys and the aggregate amount of time that we spend positioning our vessels for such events. The shipping industry uses available days to measure the number of days in a period during which vessels should be capable of generating revenues.
|
(4) |
Operating days are the number of available days in a period less the aggregate number of days that our vessels are off-hire due to any reason, including unforeseen circumstances. The shipping industry uses operating days to measure the aggregate number of days in a period during which vessels actually generate revenues.
|
(5) |
We calculate fleet utilization by dividing the number of our operating days during a period by the number of our available days during the period. The shipping industry uses fleet utilization to measure a company's efficiency in finding suitable employment for its vessels and minimizing the amount of days that its vessels are off-hire for reasons other than scheduled repairs or repairs under guarantee, vessel upgrades, special surveys or vessel positioning for such events.
|
(6) |
Time charter equivalent rates, or TCE rates, are defined as our time charter revenues less voyage expenses during a period divided by the number of our available days during the period, which is consistent with industry standards. Voyage expenses include port charges, bunker (fuel) expenses, canal charges and commissions. TCE rate is a non-GAAP measure,
and management believes it is useful to investors because it is a standard shipping industry
performance measure used primarily to compare daily earnings generated by vessels on time charters with daily earnings generated by vessels on voyage charters, because charter hire rates for vessels on voyage charters are generally not expressed in per day amounts while charter hire rates
for vessels on time charters are generally expressed in such amounts. The following table reflects the calculation of our TCE rates for the periods presented.
|
Year Ended December 31,
|
||||||||||||||||||||
2016
|
2015
|
2014
|
2013
|
2012
|
||||||||||||||||
(in thousands of U.S. dollars, except for
|
||||||||||||||||||||
TCE rates, which are expressed in U.S. dollars, and available days)
|
||||||||||||||||||||
Time charter revenues
|
$
|
114,259
|
$
|
157,712
|
$
|
175,576
|
$
|
164,005
|
$
|
220,785
|
||||||||||
Less: voyage expenses
|
(13,826
|
)
|
(15,528
|
)
|
(10,665
|
)
|
(8,119
|
)
|
(8,274
|
)
|
||||||||||
Time charter equivalent revenues
|
$
|
100,433
|
$
|
142,184
|
$
|
164,911
|
$
|
155,886
|
$
|
212,511
|
||||||||||
Available days
|
16,447
|
14,600
|
13,650
|
12,029
|
9,998
|
|||||||||||||||
Time charter equivalent (TCE) rate
|
$
|
6,106
|
$
|
9,739
|
$
|
12,081
|
$
|
12,959
|
$
|
21,255
|
(7) |
Daily vessel operating expenses, which include crew wages and related costs, the cost of insurance,
expenses
relating to repairs and maintenance, the costs of spares and consumable stores, tonnage taxes and other miscellaneous expenses, are calculated by dividing vessel operating expenses by ownership days for the relevant period.
|
Ÿ |
supply and demand for energy resources, commodities, semi-finished and finished consumer and industrial products;
|
Ÿ |
changes in the exploration or production of energy resources, commodities, semi-finished and finished consumer and industrial products;
|
Ÿ |
the location of regional and global exploration, production and manufacturing facilities;
|
Ÿ |
the location of consuming regions for energy resources, commodities, semi-finished and finished consumer and industrial products;
|
Ÿ |
the globalization of production and manufacturing;
|
Ÿ |
global and regional economic and political conditions, including armed conflicts and terrorist activities; embargoes and strikes;
|
Ÿ |
natural disasters and other disruptions in international trade;
|
Ÿ |
developments in international trade;
|
Ÿ |
changes in seaborne and other transportation patterns, including the distance cargo is transported by sea;
|
Ÿ |
environmental and other regulatory developments;
|
Ÿ |
currency exchange rates; and
|
Ÿ |
weather.
|
Ÿ |
the number of newbuilding orders and deliveries, including slippage in deliveries;
|
Ÿ |
the number of shipyards and ability of shipyards to deliver vessels;
|
Ÿ |
port and canal congestion;
|
Ÿ |
the scrapping rate of older vessels;
|
Ÿ |
vessel casualties; and
|
Ÿ |
the number of vessels that are out of service, namely those that are laid-up, drydocked, awaiting repairs or otherwise not available for hire.
|
· |
marine disaster;
|
· |
terrorism;
|
· |
environmental accidents;
|
· |
cargo and property losses or damage;
|
· |
business interruptions caused by mechanical failure, human error, war, terrorism, political action in various countries, labor strikes or adverse weather conditions; and
|
· |
piracy.
|
· |
the prevailing level of charter hire rates;
|
· |
general economic and market conditions affecting the shipping industry;
|
· |
competition from other shipping companies and other modes of transportation;
|
· |
the types, sizes and ages of vessels;
|
· |
the supply and demand for vessels;
|
· |
applicable governmental regulations;
|
· |
technological advances; and
|
· |
the cost of newbuildings.
|
· |
locate and acquire suitable vessels;
|
· |
identify and consummate acquisitions or joint ventures;
|
· |
enhance our customer base;
|
· |
manage our expansion; and
|
· |
obtain required financing on acceptable terms.
|
· |
pay dividends if we do not repay amounts drawn under our loan facilities, if there is a default under the loan facilities or if the payment of the dividend would result in a default or breach of a loan covenant;
|
· |
incur additional indebtedness, including through the issuance of guarantees;
|
· |
change the flag, class or management of our vessels;
|
· |
create liens on our assets;
|
· |
sell our vessels;
|
· |
enter into a time charter or consecutive voyage charters that have a term that exceeds, or which by virtue of any optional extensions may exceed a certain period;
|
· |
merge or consolidate with, or transfer all or substantially all our assets to, another person; and
|
· |
enter into a new line of business.
|
· |
actual or anticipated fluctuations in our quarterly and annual results and those of other public companies in our industry;
|
· |
mergers and strategic alliances in the dry bulk shipping industry;
|
· |
market conditions in the dry bulk shipping industry;
|
· |
changes in government regulation;
|
· |
shortfalls in our operating results from levels forecast by securities analysts;
|
· |
announcements concerning us or our competitors; and
|
· |
the general state of the securities market.
|
· |
authorizing our board of directors to issue "blank check" preferred stock without shareholder approval;
|
· |
providing for a classified board of directors with staggered, three-year terms;
|
· |
prohibiting cumulative voting in the election of directors;
|
· |
authorizing the removal of directors only for cause and only upon the affirmative vote of the holders of a majority of the outstanding shares of our common stock entitled to vote for the directors;
|
· |
prohibiting shareholder action by written consent;
|
· |
limiting the persons who may call special meetings of shareholders; and
|
· |
establishing advance notice requirements for nominations for election to our board of directors or for proposing matters that can be acted on by shareholders at shareholder meetings.
|
· |
changes in our operating cash flow, capital expenditure requirements, working capital requirements and other cash needs;
|
· |
restrictions under our existing or future credit facilities or any future debt securities on our ability to pay dividends if an event of default has occurred and is continuing or if the payment of the dividend would result in an event of default, or under certain facilities if it would result in the breach of certain financial covenants;
|
· |
the amount of any cash reserves established by our board of directors; and
|
· |
restrictions under Marshall Islands law, which generally prohibits the payment of dividends other than from surplus (retained earnings and the excess of consideration received for the sale of shares above the par value of the shares) or while a company is insolvent or would be rendered insolvent by the payment of such a dividend.
|
Vessel
|
Sister Ships*
|
Gross Rate (USD Per Day)
|
Com**
|
Charterers
|
Delivery Date to Charterers***
|
Redelivery Date to Owners****
|
Notes
|
|
BUILT DWT
|
||||||||
23 Panamax Bulk Carriers
|
||||||||
1
|
DANAE
|
A
|
$4,900
|
5.00%
|
Dampskibsselskabet Norden A/S, Copenhagen
|
9-Dec-15
|
11-Feb-17
|
1
|
2001 75,106
|
||||||||
2
|
DIONE
|
A
|
$4,350
|
5.00%
|
Nidera S.P.A., Roma
|
4-Feb-16
|
28-Jan-17
|
|
$7,200
|
5.00%
|
Caravel Shipping Limited, Hong Kong
|
3-Feb-17
|
4-May-17
|
||||
$7,050
|
5.00%
|
4-May-17
|
3-Nov-17 - 18-Feb-18
|
|||||
2001 75,172
|
||||||||
3
|
NIREFS
|
A
|
$4,600
|
5.00%
|
Transgrain Shipping B.V., Rotterdam
|
15-Jan-16
|
14-Feb-17
|
|
$6,500
|
5.00%
|
Raffles Shipping International Pte Ltd, Singapore
|
14-Feb-17
|
31-Mar-17
|
2
|
|||
2001 75,311
|
||||||||
4
|
ALCYON
|
A
|
$5,000
|
5.00%
|
Dampskibsselskabet Norden A/S, Copenhagen
|
4-May-16
|
4-May-17 - 4-Sep-17
|
|
2001 75,247
|
||||||||
5
|
TRITON
|
A
|
$6,300
|
5.00%
|
Windrose SPS Shipping and Trading S.A., Geneva
|
25-Oct-16
|
25-Mar-17 - 9-Jun-17
|
|
2001 75,336
|
||||||||
6
|
OCEANIS
|
A
|
$5,200
|
5.00%
|
Nidera S.P.A., Roma
|
30-Jun-16
|
30-Mar-17 - 30-May-17
|
|
2001 75,211
|
||||||||
7
|
THETIS
|
B
|
$5,150
|
5.00%
|
Transgrain Shipping B.V., Rotterdam
|
19-Jun-16
|
19-Apr-17 - 3-Aug-17
|
|
2004 73,583
|
||||||||
8
|
PROTEFS
|
B
|
$4,500
|
5.00%
|
Transgrain Shipping B.V., Rotterdam
|
23-Feb-16
|
25-Feb-17 - 23-Jun-17
|
3
|
2004 73,630
|
||||||||
9
|
CALIPSO
|
B
|
$6,020
|
5.00%
|
Windrose SPS Shipping and Trading S.A., Geneva
|
24-Aug-16
|
24-Feb-17 - 8-Apr-17
|
3
|
2005 73,691
|
||||||||
10
|
CLIO
|
B
|
$5,350
|
5.00%
|
Transgrain Shipping B.V., Rotterdam
|
22-May-16
|
22-Apr-17 - 22-Jul-17
|
|
2005 73,691
|
||||||||
11
|
NAIAS
|
B
|
$7,500
|
5.00%
|
Glencore Agriculture B.V., Rotterdam
|
27-Dec-16
|
12-Jul-17 - 11-Nov-17
|
|
2006 73,546
|
||||||||
12
|
ARETHUSA
|
B
|
$5,000
|
5.00%
|
United Bulk Carriers International S.A., Luxembourg
|
10-Jun-16
|
23-Jan-17
|
4
|
$7,200
|
5.00%
|
Noble Resources International Pte. Ltd., Singapore
|
23-Jan-17
|
23-Nov-17 - 23-Mar-18
|
||||
2007 73,593
|
||||||||
13
|
ERATO
|
C
|
$4,650
|
5.00%
|
Glencore Grain B.V., Rotterdam
|
26-Mar-16
|
25-Feb-17 - 26-May-17
|
3
|
2004 74,444
|
||||||||
14
|
CORONIS
|
C
|
$4,750
|
5.00%
|
Narina Maritime Ltd
|
19-Mar-16
|
24-Feb-17 - 19-May-17
|
3
|
2006 74,381
|
||||||||
15
|
MELITE
|
D
|
$8,000
|
5.00%
|
Uniper Global Commodities SE, Düsseldorf
|
6-Dec-16
|
6-Jul-17 - 6-Oct-17
|
|
2004 76,436
|
||||||||
16
|
MELIA
|
D
|
$7,200
|
5.00%
|
Nidera S.P.A., Roma
|
24-Oct-15
|
20-Feb-17 - 24-Feb-17
|
3
|
2005 76,225
|
||||||||
17
|
ARTEMIS
|
$5,350
|
5.00%
|
Bunge S.A., Geneva
|
7-Jun-16
|
7-Apr-17 22-Jul-17
|
||
2006 76,942
|
||||||||
18
|
LETO
|
$7,750
|
5.00%
|
Glencore Agriculture B.V., Rotterdam
|
29-Dec-16
|
29-Sep-17 - 29-Jan-18
|
||
2010 81,297
|
||||||||
19
|
SELINA
|
E
|
$5,800
|
5.00%
|
Dampskibsselskabet Norden A/S, Copenhagen
|
24-Mar-16
|
24-Jan-17
|
|
$4,500
|
5.00%
|
BG Shipping Co., Limited, Hong Kong
|
24-Jan-17
|
23-Feb-17
|
||||
$7,100
|
5.00%
|
23-Feb-17
|
24-Oct-17 - 8-Feb-18
|
|||||
2010 75,700
|
||||||||
20
|
MAERA
|
E
|
$4,500
|
5.00%
|
United Bulk Carriers International S.A., Luxembourg
|
10-May-16
|
23-Feb-17 - 28-Apr-17
|
3
|
2013 75,403
|
||||||||
21
|
ISMENE
|
$5,850
|
5.00%
|
Glencore Grain B.V., Rotterdam
|
7-Aug-16
|
23-May-17 - 22-Sep-17
|
||
2013 77,901
|
||||||||
22
|
CRYSTALIA
|
F
|
$6,250
|
5.00%
|
SwissMarine Services S.A., Geneva
|
28-Jun-16
|
28-May-17 28-Aug-17
|
|
2014 77,525
|
||||||||
23
|
ATALANDI
|
F
|
$5,300
|
5.00%
|
Glencore Grain B.V., Rotterdam
|
26-Mar-16
|
26-Nov-17 - 26-Apr-18
|
|
2014 77,529
|
4 Newcastlemax Bulk Carriers
|
||||||||
45
|
LOS ANGELES
|
L
|
$7,750
|
5.00%
|
SwissMarine Services S.A., Geneva
|
9-Dec-15
|
14-Jan-17
|
9
|
BCI_2014 5TCs AVG + 14%
|
5.00%
|
22-Jan-17
|
7-Feb-18 - 22-Apr-18
|
|||||
2012 206,104
|
||||||||
46
|
PHILADELPHIA
|
L
|
$6,450
|
5.00%
|
RWE Supply & Trading GmbH, Essen
|
20-Jan-16
|
22-Feb-17 - 1-Mar-17
|
3
|
2012 206,040
|
||||||||
47
|
SAN FRANCISCO
|
M
|
$11,750
|
5.00%
|
Koch Shipping Pte. Ltd., Singapore
|
5-Jan-17
|
5-Jan-18 - 20-May-18
|
|
2017 208,006
|
||||||||
48
|
NEWPORT NEWS
|
M
|
BCI_2014 5TCs AVG + 24%
|
5.00%
|
SwissMarine Services S.A., Geneva
|
10-Jan-17
|
10-Nov-18 - 10-Mar-19
|
|
2017 208,021
|
* Each dry bulk carrier is a "sister ship", or closely similar, to other dry bulk carriers that have the same letter.
|
** Total commission percentage paid to third parties.
|
*** In case of newly acquired vessel with time charter attached, this date refers to the expected/actual date of delivery of the vessel to the Company.
|
**** Range of redelivery dates, with the actual date of redelivery being at the Charterers' option, but subject to the terms, conditions, and exceptions of the particular charterparty.
|
1 Currently without an active charterparty.
|
2 Redelivery date based on an estimated time charter trip duration of about 45 days.
|
3 Based on latest information.
|
4 As per addendum dated January 2, 2017, charterers exercised their option to extend the initially agreed maximum redelivery date, i.e. January 10, 2017 and pay US$7,000 per day.
|
5 Estimated date.
|
6 Vessel off-hire for drydocking from October 24, 2016 to November 11, 2016.
|
7 Clearlake Shipping Pte. Ltd., Singapore is a member of the Gunvor Group.
|
8 Charterers will pay US$5,150 per day for the first 15 days of the charter period.
|
9 Vessel on scheduled drydocking from January 14, 2017 to January 22, 2017.
|
· |
Very Large Ore Carriers
. Very large ore carriers, or VLOCs, have a carrying capacity of more than 200,000 dwt and are a comparatively new sector of the dry bulk carrier fleet. VLOCs are built to exploit economies of scale on long-haul iron ore routes.
|
· |
Capesize
. Capesize vessels have a carrying capacity of 110,000-199,999 dwt. Only the largest ports around the world possess the infrastructure to accommodate vessels of this size. Capesize vessels are primarily used to transport iron ore or coal and, to a much lesser extent, grains, primarily on long-haul routes.
|
· |
Post-Panamax
. Post-Panamax vessels have a carrying capacity of 80,000-109,999 dwt. These vessels tend to have a shallower draft and larger beam than a standard Panamax vessel with a higher cargo capacity. These vessels have been designed specifically for loading high cubic cargoes from draught restricted ports, although they cannot transit the Panama Canal.
|
· |
Panamax
. Panamax vessels have a carrying capacity of 60,000-79,999 dwt. These vessels carry coal, iron ore, grains, and, to a lesser extent, minor bulks, including steel products, cement and fertilizers. Panamax vessels are able to pass through the Panama Canal, making them more versatile than larger vessels with regard to accessing different trade routes. Most Panamax and Post-Panamax vessels are "gearless," and therefore must be served by shore-based cargo handling equipment. However, there are a small number of geared vessels with onboard cranes, a feature that enhances trading flexibility and enables operation in ports which have poor infrastructure in terms of loading and unloading facilities.
|
· |
Handymax/Supramax
. Handymax vessels have a carrying capacity of 40,000-59,999 dwt. These vessels operate in a large number of geographically dispersed global trade routes, carrying primarily grains and minor bulks. Within the Handymax category there is also a sub-sector known as Supramax. Supramax bulk carriers are ships between 50,000 to 59,999 dwt, normally offering cargo loading and unloading flexibility with on-board cranes, or "gear," while at the same time possessing the cargo carrying capability approaching conventional Panamax bulk carriers.
|
· |
Handysize
.
Handysize vessels have a carrying capacity of up to 39,999 dwt. These vessels are primarily involved in carrying minor bulk cargoes. Increasingly, ships of this type operate within regional trading routes, and may serve as trans-shipment feeders for larger vessels. Handysize vessels are well suited for small ports with length and draft restrictions. Their cargo gear enables them to service ports lacking the infrastructure for cargo loading and unloading.
|
· |
We own a modern, high quality fleet of dry bulk carriers
. We believe that owning a modern, high quality fleet reduces operating costs, improves safety and provides us with a competitive advantage in securing favorable time charters. We maintain the quality of our vessels by carrying out regular inspections, both while in port and at sea, and adopting a comprehensive maintenance program for each vessel.
|
· |
Our fleet includes thirteen groups of sister ships.
We believe that maintaining a fleet that includes sister ships enhances the revenue generating potential of our fleet by providing us with operational and scheduling flexibility. The uniform nature of sister ships also improves our operating efficiency by allowing our fleet manager to apply the technical knowledge of one vessel to all vessels of the same series and creates economies of scale that enable us to realize cost savings when maintaining, supplying and crewing our vessels.
|
· |
We have an experienced management team.
Our management team consists of experienced executives who have, on average, more than 30 years of operating experience in the shipping industry and has demonstrated ability in managing the commercial, technical and financial areas of our business. Our management team is led by Mr. Simeon Palios, a qualified naval architect and engineer who has more than 40 years of experience in the shipping industry.
|
· |
We benefit from the experience and reputation of Diana Shipping Services S.A. and the relationship with Wilhelmsen Ship Management through the Diana Wilhelmsen Management Limited joint venture.
|
· |
We benefit from strong relationships with members of the shipping and financial industries.
We have developed strong relationships with major international charterers, shipbuilders and financial institutions that we believe are the result of the quality of our operations, the strength of our management team and our reputation for dependability.
|
· |
We have a strong balance sheet and a relatively low level of indebtedness.
We believe that our strong balance sheet and relatively low level of indebtedness provide us with the flexibility to increase the amount of funds that we may draw under our loan facilities in connection with future acquisitions and enable us to use cash flow that would otherwise be dedicated to debt service for other purposes.
|
· |
on-board installation of automatic identification systems to provide a means for the automatic transmission of safety-related information from among similarly equipped ships and shore stations, including information on a ship's identity, position, course, speed and navigational status;
|
· |
on-board installation of ship security alert systems, which do not sound on the vessel but only alert the authorities on shore;
|
· |
the development of vessel security plans;
|
· |
ship identification number to be permanently marked on a vessel's hull;
|
· |
a continuous synopsis record kept onboard showing a vessel's history including the name of the ship, the state whose flag the ship is entitled to fly, the date on which the ship was registered with that state, the ship's identification number, the port at which the ship is registered and the name of the registered owner(s) and their registered address; and
|
· |
compliance with flag state security certification requirements.
|
· |
Annual Surveys:
For seagoing ships, annual surveys are conducted for the hull and the machinery, including the electrical plant, and where applicable for special equipment classed, within three months before or after each anniversary date of the date of commencement of the class period indicated in the certificate.
|
· |
Intermediate Surveys:
Extended annual surveys are referred to as intermediate surveys and typically are conducted two and one-half years after commissioning and each class renewal. Intermediate surveys are to be carried out at or between the occasion of the second or third annual survey.
|
· |
Class Renewal Surveys:
Class renewal surveys, also known as special surveys, are carried out for the ship's hull, machinery, including the electrical plant, and for any special equipment classed, at the intervals indicated by the character of classification for the hull. At the special survey, the vessel is thoroughly examined, including audio-gauging to determine the thickness of the steel structures. Should the thickness be found to be less than class requirements, the classification society would prescribe steel renewals. The classification society may grant a one-year grace period for completion of the special survey. Substantial amounts of money may have to be spent for steel renewals to pass a special survey if the vessel experiences excessive wear and tear. In lieu of the special survey every four or five years, depending on whether a grace period was granted, a shipowner has the option of arranging with the classification society for the vessel's hull or machinery to be on a continuous survey cycle, in which every part of the vessel would be surveyed within a five-year cycle. Upon a shipowner's request, the surveys required for class renewal may be split according to an agreed schedule to extend over the entire period of class. This process is referred to as continuous class renewal.
|
· |
Ownership days.
We define ownership days as the aggregate number of days in a period during which each vessel in our fleet has been owned by us. Ownership days are an indicator of the size of our fleet over a period and affect both the amount of revenues and the amount of expenses that we record during a period.
|
· |
Available days.
We define available days as the number of our ownership days less the aggregate number of days that our vessels are off-hire due to scheduled repairs or repairs under guarantee, vessel upgrades or special surveys and the aggregate amount of time that we spend positioning our vessels for such events. The shipping industry uses available days to measure the number of days in a period during which vessels should be capable of generating revenues.
|
· |
Operating days.
We define operating days as the number of our available days in a period less the aggregate number of days that our vessels are off-hire due to any reason, including unforeseen circumstances. The shipping industry uses operating days to measure the aggregate number of days in a period during which vessels actually generate revenues.
|
· |
Fleet utilization.
We calculate fleet utilization by dividing the number of our operating days during a period by the number of our available days during the period. The shipping industry uses fleet utilization to measure a company's efficiency in finding suitable employment for its vessels and minimizing the amount of days that its vessels are off-hire for reasons other than scheduled repairs or repairs under guarantee, vessel upgrades, special surveys or vessel positioning for such events.
|
· |
TCE rates.
We define Time Charter Equivalent, or TCE rates as our time charter revenues less voyage expenses during a period divided by the number of our available days during the period, which is consistent with industry standards. TCE rate is a non-GAAP measure and is a standard shipping industry performance measure used primarily to compare daily earnings generated by vessels on time charters with daily earnings generated by vessels on voyage charters, because charter hire rates for vessels on voyage charters are generally not expressed in per day amounts while charter hire rates for vessels on time charters generally are expressed in such amounts.
|
Year Ended December 31,
|
||||||||||||
2016
|
2015
|
2014
|
||||||||||
Ownership days
|
16,542
|
14,900
|
13,822
|
|||||||||
Available days
|
16,447
|
14,600
|
13,650
|
|||||||||
Operating days
|
16,354
|
14,492
|
13,564
|
|||||||||
Fleet utilization
|
99.4
|
%
|
99.3
|
%
|
99.4
|
%
|
||||||
Time charter equivalent (TCE) rate (1)
|
$
|
6,106
|
$
|
9,739
|
$
|
12,081
|
· |
the duration of our charters;
|
· |
our decisions relating to vessel acquisitions and disposals;
|
· |
the amount of time that we spend positioning our vessels;
|
· |
the amount of time that our vessels spend in drydock undergoing repairs;
|
· |
maintenance and upgrade work;
|
· |
the age, condition and specifications of our vessels;
|
· |
levels of supply and demand in the dry bulk shipping industry; and
|
· |
other factors affecting spot market charter rates for dry bulk carriers.
|
· |
obtain the charterer's consent to us as the new owner;
|
· |
obtain the charterer's consent to a new technical manager;
|
· |
in some cases, obtain the charterer's consent to a new flag for the vessel;
|
· |
arrange for a new crew for the vessel, and where the vessel is on charter, in some cases, the crew must be approved by the charterer;
|
· |
replace all hired equipment on board, such as gas cylinders and communication equipment;
|
· |
negotiate and enter into new insurance contracts for the vessel through our own insurance brokers;
|
· |
register the vessel under a flag state and perform the related inspections in order to obtain new trading certificates from the flag state;
|
· |
implement a new planned maintenance program for the vessel; and
|
· |
ensure that the new technical manager obtains new certificates for compliance with the safety and vessel security regulations of the flag state.
|
· |
employment and operation of our vessels; and
|
· |
management of the financial, general and administrative elements involved in the conduct of our business and ownership of our vessels.
|
· |
vessel maintenance and repair;
|
· |
crew selection and training;
|
· |
vessel spares and stores supply;
|
· |
contingency response planning;
|
· |
onboard safety procedures auditing;
|
· |
accounting;
|
· |
vessel insurance arrangement;
|
· |
vessel chartering;
|
· |
vessel security training and security response plans (ISPS);
|
· |
obtaining of ISM certification and audit for each vessel within the six months of taking over a vessel;
|
· |
vessel hiring management;
|
· |
vessel surveying; and
|
· |
vessel performance monitoring.
|
· |
management of our financial resources, including banking relationships, i.e., administration of bank loans and bank accounts;
|
· |
management of our accounting system and records and financial reporting;
|
· |
administration of the legal and regulatory requirements affecting our business and assets; and
|
· |
management of the relationships with our service providers and customers.
|
· |
rates and periods of charter hire;
|
· |
levels of vessel operating expenses;
|
· |
depreciation expenses;
|
· |
financing costs; and
|
· |
fluctuations in foreign exchange rates.
|
· |
reports by industry analysts and data providers that focus on our industry and related dynamics affecting vessel values;
|
· |
news and industry reports of similar vessel sales;
|
· |
news and industry reports of sales of vessels that are not similar to our vessels where we have made certain adjustments in an attempt to derive information that can be used as part of our estimates;
|
· |
approximate market values for our vessels or similar vessels that we have received from shipbrokers, whether solicited or unsolicited, or that shipbrokers have generally disseminated;
|
· |
offers that we may have received from potential purchasers of our vessels; and
|
· |
vessel sale prices and values of which we are aware through both formal and informal communications with shipowners, shipbrokers, industry analysts and various other shipping industry participants and
observers.
|
Vessel
|
Dwt
|
Year Built
|
Carrying Value
(in millions of US dollars)
|
||
2016
|
2015
|
||||
1
|
Alcmene
|
93,193
|
2010
|
31.6*
|
33.3*
|
2
|
Alcyon
|
75,247
|
2001
|
9.1*
|
9.9*
|
3
|
Aliki
|
180,235
|
2005
|
65.5*
|
70.3*
|
4
|
Amphitrite
|
98,697
|
2012
|
21.3*
|
22.2*
|
5
|
Arethusa
|
73,593
|
2007
|
23.1*
|
24.5*
|
6
|
Artemis
|
76,942
|
2006
|
17.3*
|
18.4*
|
7
|
Atalandi
|
77,529
|
2014
|
28.4*
|
29.5*
|
8
|
Baltimore
|
177,243
|
2005
|
23.2*
|
24.8*
|
9
|
Boston
|
177,828
|
2007
|
71.8*
|
76.0*
|
10
|
Calipso
|
73,691
|
2005
|
12.4*
|
13.3*
|
11
|
Clio
|
73,691
|
2005
|
12.6*
|
13.3*
|
12
|
Coronis
|
74,381
|
2006
|
25.0*
|
26.6*
|
13
|
Crystalia
|
77,525
|
2014
|
28.0*
|
29.1*
|
14
|
Danae
|
75,106
|
2001
|
10.6*
|
11.6*
|
15
|
Dione
|
75,172
|
2001
|
10.5*
|
11.0*
|
16
|
Erato
|
74,444
|
2004
|
22.0*
|
23.7*
|
17
|
G. P. Zafirakis
|
179,492
|
2014
|
53.4*
|
55.5*
|
18
|
Houston
|
177,729
|
2009
|
46.3*
|
48.8*
|
19
|
Ismene
|
77,901
|
2013
|
13.7
|
|
20
|
Leto
|
81,297
|
2010
|
26.1*
|
27.5*
|
21
|
Los Angeles
|
206,104
|
2012
|
49.5*
|
51.6*
|
22
|
Maera
|
75,403
|
2013
|
13.3
|
|
23
|
Maia
|
82,193
|
2009
|
17.4*
|
18.4*
|
24
|
Medusa
|
82,194
|
2010
|
17.0*
|
17.7*
|
25
|
Melia
|
76,225
|
2005
|
16.1*
|
17.3*
|
26
|
Melite
|
76,436
|
2004
|
23.6*
|
25.4*
|
27
|
Myrsini
|
82,117
|
2010
|
20.0*
|
21.1*
|
28
|
Myrto
|
82,131
|
2013
|
23.0*
|
23.9*
|
29
|
Naias
|
73,546
|
2006
|
24.4*
|
25.6*
|
30
|
New Orleans
|
180,960
|
2015
|
41.7*
|
43.1*
|
31
|
New York
|
177,773
|
2010
|
47.4*
|
49.8*
|
32
|
Nirefs
|
75,311
|
2001
|
9.1*
|
9.9*
|
33
|
Norfolk
|
164,218
|
2002
|
76.2*
|
83.1*
|
34
|
Oceanis
|
75,211
|
2001
|
9.7*
|
9.9*
|
38
|
P. S. Palios
|
179,134
|
2013
|
46.3*
|
48.2*
|
35
|
Philadelphia
|
206,040
|
2012
|
50.3*
|
52.4*
|
36
|
Polymnia
|
98,704
|
2012
|
21.2*
|
22.1*
|
37
|
Protefs
|
73,630
|
2004
|
12.0*
|
12.9*
|
39
|
Salt Lake City
|
171,810
|
2005
|
101.9*
|
109.1*
|
40
|
Santa Barbara
|
179,426
|
2015
|
46.8*
|
48.5*
|
41
|
Seattle
|
179,362
|
2011
|
27.8*
|
29.0
|
42
|
Selina
|
75,700
|
2010
|
11.5
|
|
43
|
Semirio
|
174,261
|
2007
|
62.5*
|
66.2*
|
44
|
Sideris GS
|
174,186
|
2006
|
56.9*
|
59.6*
|
45
|
Thetis
|
73,583
|
2004
|
21.8*
|
23.5*
|
46
|
Triton
|
75,336
|
2001
|
9.3*
|
10.1*
|
Total
|
5,241,930
|
1,408.6
|
1,447.7
|
Average estimated daily time charter equivalent rate used
|
Average break even rate
|
|||||||
Panamax/Kamsarmax/Post-Panamax
|
$
|
21,091
|
$
|
10,405
|
||||
Capesize/Newcastlemax
|
$
|
37,024
|
$
|
16,870
|
1-year
(period)
|
Impairment charge
(in USD million)
|
3-year
(period)
|
Impairment charge
(in USD million)
|
5-year
(period)
|
Impairment charge
(in USD million)
|
|||||||||||||||||||
Panamax/Kamsarmax/Post-Panamax
|
$
|
6,263
|
221
|
$
|
8,594
|
221
|
$
|
9,118
|
217
|
|||||||||||||||
Capesize/Newcastlemax
|
$
|
7,342
|
507
|
$
|
13,056
|
485
|
$
|
13,723
|
485
|
Payments due by period
|
||||||||||||||||||||
Contractual Obligations
|
Total Amount
|
Less than 1 year
|
2-3 years
|
4-5 years
|
More than 5 years
|
|||||||||||||||
(in thousands of US dollars)
|
||||||||||||||||||||
Loan Agreements and Notes (1)
|
$
|
602,717
|
$
|
66,470
|
$
|
175,336
|
$
|
292,259
|
$
|
68,652
|
||||||||||
Estimated Interest Payments on Loan Agreements and Notes (1)
|
67,409
|
20,726
|
34,529
|
11,575
|
579
|
|||||||||||||||
Construction contracts (2)
|
52,440
|
52,440
|
-
|
-
|
-
|
|||||||||||||||
Broker services agreement (3)
|
450
|
450
|
-
|
-
|
-
|
|||||||||||||||
Preferred dividends (4)
|
13,461
|
5,769
|
7,692
|
-
|
-
|
|||||||||||||||
Total
|
$
|
736,477
|
$
|
145,855
|
$
|
217,557
|
$
|
303,834
|
$
|
69,231
|
(1) |
As of December 31, 2016, we had an aggregate principal amount of $602.7 million of indebtedness outstanding under our loan facilities and our Notes. On November 30, 2016, we received a letter from BNP Paribas advising us that we were not in compliance with the loan to value covenant contained in the $165.0 million loan agreement, creating a shortfall of $39.6 million. Similarly, as at December 31, 2016, we were not in compliance with the same minimum security cover requirement. We estimated the shortfall to be $25.7 million and as such an amount of $19.7 million, representing the amount which would have to be paid to the bank, was reclassified to current portion of long term debt. Estimated interest payments represent projected interest payments on our long term debt, which are based on the weighted average LIBOR rate in 2016 plus the margin of our loan agreements in 2016 and the fixed interest rate of our Notes.
|
(2) |
On January 4, 2017, we took delivery of Hull H2548, named
San Francisco,
and Hull H2549, named
Newport News
, and we paid the balance of the contract price. On the same date, we also drew down a loan of $57.24 million under our loan agreement with CEXIM Bank, to finance part of the construction cost of the vessels.
|
(3) |
Our agreement with Diana Enterprises dated April 1, 2016, expires on March 31, 2017.
|
(4) |
On February 24, 2014 we completed an offering of 2,600,000 shares of Series B Perpetual Preferred Stock, at the price of $25.0 per share, and dividends are payable at a rate equal to 8.875% per annum. At any time on or after February 14, 2019, the Series B Preferred Shares may be redeemed, in whole or in part, at a redemption price of $25.00 per share, plus an amount equal to all accumulated and unpaid dividends thereon to the date of redemption, whether or not declared. The table above presents our obligations for dividend payments until February 14, 2019. The table above does not include the payment for the redemption, which is at our option.
|
Name
|
Age
|
Position
|
||
Simeon Palios
|
75
|
Class I Director, Chief Executive Officer and Chairman
|
||
Anastasios Margaronis
|
61
|
Class I Director and President
|
||
Ioannis Zafirakis
|
45
|
Class I Director, Chief Operating Officer and Secretary
|
||
Andreas Michalopoulos
|
45
|
Chief Financial Officer and Treasurer
|
||
Maria Dede
|
44
|
Chief Accounting Officer
|
||
William (Bill) Lawes
|
73
|
Class II Director
|
||
Konstantinos Psaltis
|
78
|
Class II Director
|
||
Kyriacos Riris
|
67
|
Class II Director
|
||
Boris Nachamkin
|
83
|
Class III Director
|
||
Apostolos Kontoyannis
|
68
|
Class III Director
|
||
Semiramis Paliou
|
42
|
Class III Director
|
Year Ended December 31,
|
||||||||||||
2016
|
2015
|
2014
|
||||||||||
Shoreside
|
95
|
101
|
94
|
|||||||||
Seafaring
|
923
|
993
|
973
|
|||||||||
Total
|
1,018
|
1,094
|
1,067
|
A. |
Major Shareholders
|
Title of Class
|
Identity of Person or Group
|
Number of
Shares Owned
|
Percent of Class
|
||||
Common Stock, par value $0.01
|
Simeon Palios (1)
|
19,524,163
|
22.7%
|
||||
12 West Capital Management LP (2)
|
4,429,989
|
5.2%
|
|||||
Kopernik Global Investors, LLC (3)
|
5,624,361
|
6.5%
|
|||||
Franklin Resources Inc. (4)
|
13,370,940
|
15.5%
|
|||||
All officers and directors as a group (5)
|
22,749,215
|
26.5%
|
(1) |
Mr. Simeon Palios indirectly may be deemed to beneficially own 9,524,360 shares beneficially owned by Ironwood Trading Corp. and 9,999,803 shares beneficially owned by Diana Enterprises Inc., including 4,762,180 shares beneficially owned through Corozal Compania Naviera, as the result of his ability to control the vote and disposition of such entities, for an aggregate of 19,524,163 shares. As of December 31, 2014, 2015 and 2016, Mr. Simeon Palios owned indirectly 19.3%, 20.6% and 22.2%, respectively, of our outstanding common stock.
|
(2) |
This information is derived from a
Schedule 13G/A filed with the SEC on February 14, 2017.
|
(3) |
This information is derived from a
Schedule 13G filed with the SEC on February 3, 2017.
|
(4) |
This information is derived from a
Schedule 13G/A filed with the SEC on February 8, 2017, and represents an increase from the 13.4% ownership reported on a Schedule 13G filed with the SEC on January 8, 2016.
|
(5) |
Mr. Simeon Palios is our only director or officer that beneficially owns 5% or more of our outstanding common stock. Mr. Anastasios Margaronis, our President and a member of our board of directors is indirect shareholder through ownership of stock held in Corozal Compania Naviera S.A., and Ironwood Trading Corp. Mr. Margaronis does not have dispositive or voting power with regard to shares held by Corozal Compania S.A. and Ironwood Trading Corp. and, accordingly, is not considered to be beneficial owner of our common shares held through Corozal Compania Naviera S.A. and Ironwood Trading Corp. Mr. Anastasios Margaronis also owns indirectly 2.6% of our outstanding common stock. Messrs. Lawes, Psaltis, Nachamkin and Kontoyannis, each a non-executive director of ours each owns less than 1% of our outstanding common stock. In addition, Diana Enterprises owns indirectly 100,390, or 3.9% of the outstanding Series B Preferred Shares and Mr. Anastasios Margaronis owns indirectly 28,025, or 1.1% of the outstanding Series B Preferred Shares. All officers and directors as a group own 132,775, or 5.1% of our outstanding Series B Preferred Shares.
|
2017
|
2016
|
2015
|
2014
|
*
|
||||||||||||||||||||||||||||
Period
|
High
|
Low
|
High
|
Low
|
High
|
Low
|
High
|
Low
|
||||||||||||||||||||||||
Annual
|
$
|
18.52
|
$
|
9.50
|
$
|
25.59
|
$
|
10.80
|
$
|
26.98
|
$
|
22.76
|
||||||||||||||||||||
1st quarter
|
$
|
15.15
|
$
|
9.50
|
$
|
25.59
|
$
|
24.08
|
||||||||||||||||||||||||
2nd quarter
|
18.52
|
13.42
|
25.59
|
24.60
|
||||||||||||||||||||||||||||
3rd quarter
|
18.33
|
14.99
|
25.14
|
19.69
|
||||||||||||||||||||||||||||
4th quarter
|
17.25
|
14.53
|
21.49
|
10.80
|
||||||||||||||||||||||||||||
August
|
$
|
17.34
|
$
|
16.95
|
||||||||||||||||||||||||||||
September
|
17.44
|
14.99
|
||||||||||||||||||||||||||||||
October
|
17.25
|
14.89
|
||||||||||||||||||||||||||||||
November
|
16.90
|
14.53
|
||||||||||||||||||||||||||||||
December
|
16.48
|
15.40
|
||||||||||||||||||||||||||||||
January
|
$
|
19.32
|
$
|
17.24
|
||||||||||||||||||||||||||||
February**
|
19.03
|
18.64
|
*Commencing on February 21, 2014
|
||||||||||||||||||||||||||||||||
** For the period from February 1, 2017 until February 16, 2017.
|
(1) |
It is organized in a qualified foreign country which, as defined, is one that grants an equivalent exemption from tax to corporations organized in the United States in respect of the Shipping Income for which exemption is being claimed under Section 883 of the Code, or the "Country of Organization Requirement"; and
|
(2) |
It can satisfy any one of the following two stock ownership requirements:
|
· |
more than 50% of its stock, in terms of value, is beneficially owned by qualified shareholders which, as defined, includes individuals who are residents of a qualified foreign country, or the "50% Ownership Test"; or
|
· |
its stock is "primarily and regularly" traded on an established securities market located in the United States or a qualified foreign country, or the "Publicly Traded Test".
|
· |
at least 75% of the Company's gross income for such taxable year consists of passive income (e.g., dividends, interest, capital gains and rents derived other than in the active conduct of a rental business), or
|
· |
at least 50% of the average value of the assets held by the corporation during such taxable year produce, or are held for the production of, such passive income.
|
· |
the excess distribution or gain would be allocated ratably over the Non-Electing Holder's aggregate holding period for the common stock;
|
· |
the amount allocated to the current taxable year and any taxable years before the Company became a PFIC would be taxed as ordinary income; and
|
· |
the amount allocated to each of the other taxable years would be subject to tax at the highest rate of tax in effect for the applicable class of taxpayer for that year, and an interest charge for the deemed tax deferral benefit would be imposed with respect to the resulting tax attributable to each such other taxable year.
|
· |
the gain is effectively connected with the Non-U.S. Holder's conduct of a trade or business in the United States. If the Non-U.S. Holder is entitled to the benefits of a U.S. income tax treaty with respect to that gain, the gain is taxable in the United States only if attributable to a permanent establishment maintained by the Non-U.S. Holder in the United States; or
|
· |
the Non-U.S. Holder is an individual who is present in the United States for 183 days or more during the taxable year of disposition and other conditions are met.
|
· |
fails to provide an accurate taxpayer identification number;
|
· |
is notified by the IRS that he has failed to report all interest or dividends required to be shown on his U.S. federal income tax returns; or
|
· |
in certain circumstances, fails to comply with applicable certification requirements.
|
Exhibit Number
|
Description
|
1.1
|
Amended and Restated Articles of Incorporation of Diana Shipping Inc. (originally known as Diana Shipping Investment Corp.) (1)
|
1.2
|
Amended and Restated By-laws of the Company (2)
|
2.1
|
Form of Common Share Certificate (13)
|
2.2
|
Statement of Designation of the 8.875% Series B Cumulative Redeemable Perpetual Preferred Shares of the Company (3)
|
2.3
|
Certificate of Designations of the Series A Participating Preferred Stock of the Company (4)
|
2.4
|
Base Indenture, dated May 28, 2015, by and between the Company and Deutsche Bank Trust Company Americas (5)
|
2.5
|
First Supplemental Indenture to the Base Indenture, dated May 28, 2015, by and between the Company and Deutsche Bank Trust Company Americas, as trustee, relating to the Company's 8.500% Senior Notes due 2020 (6)
|
4.1
|
Stockholders Rights Agreement dated January 15, 2016 (7)
|
4.2
|
2014 Equity Incentive Plan (13)
|
4.3
|
Form of Technical Manager Purchase Option Agreement (8)
|
4.4
|
Form of Management Agreement (9)
|
4.5
|
Loan Agreement with Bremer Landesbank dated October 22, 2009 (10)
|
4.6
|
Loan Agreement with the Export-Import Bank of China and DnB Nor Bank ASA dated October 2, 2010 (10)
|
4.7
|
Loan Agreement with Emporiki Bank of Greece S.A., dated September 13, 2011 (14)
|
4.8
|
First Supplemental Agreement, by and between Bikar Shipping Company Inc., Diana Shipping Inc., DSS and Emporiki Bank of Greece S.A., dated December 11, 2012 (13)
|
4.9
|
Second Supplemental Agreement, by and between Bikar Shipping Company Inc., Diana Shipping Inc., DSS and Credit Agricole Corporate and Investment Bank, dated December 13, 2012 (13)
|
4.10
|
Loan Agreement, dated May 24, 2013, by and among Erikub Shipping Company Inc., Wotho Shipping Company Inc., DNB Bank ASA, and Export-Import Bank of China (11)
|
4.11
|
Loan Agreement, dated January 9, 2014, by and among Taka Shipping Company Inc., Fayo Shipping Company Inc., and Commonwealth Bank of Australia (11)
|
4.12
|
Loan Agreement, dated May 20, 2013, by and between Diana Shipping Inc., Eluk Shipping Company Inc. and Diana Containerships Inc. (11)
|
4.13
|
First Amendment to Loan Agreement, dated May 20, 2013, by and between Diana Shipping Inc., Eluk Shipping Company Inc. and Diana Containerships Inc., dated July 28, 2014 (13)
|
4.14
|
Second Amendment to Loan Agreement, dated May 20, 2013, by and between Diana Shipping Inc., Eluk Shipping Company Inc. and Diana Containerships Inc., dated September 9, 2015 (13)
|
4.15
|
Loan Agreement, dated December 18, 2014, by and among Weno Shipping Company Inc., Pulap Shipping Company Inc., the Banks and Financial Institutions listed therein and BNP Paribas (12)
|
4.16
|
Loan Agreement, dated March 17, 2015, by and among Knox Shipping Company Inc., Bokak Shipping Company Inc., Jemo Shipping Company Inc., Guam Shipping Company Inc., Palau Shipping Company Inc., Makur Shipping Company Inc., Mandaringina Inc., Vesta Commercial, S.A., the Banks and Financial Institutions listed therein, Nordea Bank Finland Plc and Nordea Bank AB, London Branch (12)
|
4.17
|
Administrative Services Agreement, dated October 1, 2013, by and between Diana Shipping Inc. and Diana Shipping Services S.A. (11)
|
4.18
|
Brokerage Services Agreement, dated April 1, 2015, by and between Diana Shipping Inc. and Diana Enterprises Inc. (13)
|
4.19
|
Amended and Restated Non-Competition Agreement, dated as of March 1, 2013, by and between Diana Shipping Inc. and Diana Containerships Inc. (11)
|
4.20
|
Loan Agreement with ABN AMRO Bank N.V., dated March 26, 2015 (13)
|
4.21
|
Loan Agreement with Danish Ship Finance, dated April 29, 2015 (13)
|
4.22
|
Joint Venture and Subscription Agreement with Wilhelmsen Ship Management, dated January 16, 2015 (13)
|
4.23
|
Loan Agreement with BNP Paribas, dated July 22, 2015 (13)
|
4.24
|
Loan Agreement with ING Bank N.V., dated September 30, 2015 (13)
|
4.25
|
Loan Agreement with The Export-Import Bank of China, dated January 7, 2016 (13)
|
4.26
|
Loan Agreement with ABN AMRO Bank N.V., dated March 29, 2016
|
4.27
|
Brokerage Services Agreement, dated April 1, 2016, by and between Diana Shipping Inc. and Diana Enterprises Inc.
|
4.28
|
Loan Agreement with DNB Bank ASA and The Export-Import Bank of China, dated May 10, 2016
|
4.29
|
Third Amendment to Loan Agreement, dated May 20, 2013, by and between Diana Shipping Inc., Eluk Shipping Company Inc. and Diana Containerships Inc., dated December 3, 2015
|
4.30
|
Fourth Amendment to Loan Agreement, dated May 20, 2013, by and between Diana Shipping Inc., Eluk Shipping Company Inc. and Diana Containerships Inc., dated September 12, 2016
|
4.31
|
Waiver Letter from Commonwealth Bank of Australia dated February 15, 2016
|
4.32
|
Waiver Letter from Commonwealth Bank of Australia dated January 13, 2017
|
4.33
|
Amendment to Loan Agreement dated October 2, 2010 with the Export-Import Bank of China and DnB Nor Bank ASA, dated February 15, 2017
|
8.1
|
Subsidiaries of the Company
|
11.1
|
Code of Ethics (10)
|
12.1
|
Rule 13a-14(a)/15d-14(a) Certification of Principal Executive Officer
|
12.2
|
Rule 13a-14(a)/15d-14(a) Certification of Principal Financial Officer
|
13.1
|
Certification of Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
13.2
|
Certification of Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
15.1
|
Consent of Independent Registered Public Accounting Firm
|
101
|
The following materials from the Company's Annual Report on Form 20-F for the fiscal year ended December 31, 2016, formatted in eXtensible Business Reporting Language (XBRL): (i) Consolidated Balance Sheets as of December 31, 2015 and 2016; (ii) Consolidated Statements of Operations for the years ended December 31, 2014, 2015 and 2016; (iii) Consolidated Statements of Comprehensive Income/(Loss) for the years ended December 31, 2014, 2015 and 2016; (iv) Consolidated Statements of Stockholders' Equity for the years ended December 31, 2014, 2015 and 2016; (v) Consolidated Statements of Cash Flows for the years ended December 31, 2014, 2015 and 2016; and (v) the Notes to Consolidated Financial Statements
|
(1)
|
Filed as Exhibit 1 to the Company's Form 6-K filed on May 29, 2008.
|
(2)
|
Filed as Exhibit 3.1 to the Company's Form 6-K filed on February 13, 2014.
|
(3)
|
Filed as Exhibit 3.3 to the Company's Form 8-A filed on February 13, 2014.
|
(4)
|
Filed as Exhibit 3.1 to the Company's Form 8-A12B/A filed on January 15, 2016.
|
(5)
|
Filed as Exhibit 4.1 to the Company's Form 6-K filed on May 28, 2015.
|
(6)
|
Filed as Exhibit 4.2 to the Company's Form 6-K filed on May 28, 2015.
|
(7)
|
Filed as Exhibit 4.1 to the Company's Form 8-A12B/A filed on January 15, 2016.
|
(8)
|
Filed as an Exhibit to the Company's Registration Statement (File No. 123052) on March 1, 2005.
|
(9)
|
Filed as an Exhibit to the Company's Amended Registration Statement (File No. 123052) on March 15, 2005.
|
(10)
|
Filed as an Exhibit to the Company's Annual Report filed on Form 20-F on March 30, 2010.
|
(11)
|
Filed as an Exhibit to the Company's Annual Report filed on Form 20-F on March 27, 2014.
|
(12)
|
Filed as an Exhibit to the Company's Annual Report filed on Form 20-F on March 25, 2015.
|
(13)
|
Filed as an Exhibit to the Company's Annual Report filed on Form 20-F on March 28, 2016.
|
(14)
|
Filed as an Exhibit to the Company's Annual Report filed on Form 20-F on April 20, 2012.
|
Page
|
||
Report of Independent Registered Public Accounting Firm
|
F-2
|
|
Report of Independent Registered Public Accounting Firm
|
F-3
|
|
Consolidated Balance Sheets as of December 31, 2016 and 2015
|
F-4
|
|
Consolidated Statements of Operations for the years ended December 31, 2016, 2015 and 2014
|
F-5
|
|
Consolidated Statements of Comprehensive Loss for the years ended December 31, 2016, 2015 and 2014
|
F-6
|
|
Consolidated Statements of Stockholders' Equity for the years ended December 31, 2016, 2015 and 2014
|
F-7
|
|
Consolidated Statements of Cash Flows for the years ended December 31, 2016, 2015 and 2014
|
F-8
|
|
Notes to Consolidated Financial Statements
|
F-9
|
|
2016
|
2015
|
2014
|
||||||||||
REVENUES:
|
||||||||||||
Time charter revenues
|
$
|
114,259
|
$
|
157,712
|
$
|
175,576
|
||||||
EXPENSES:
|
||||||||||||
Voyage expenses
|
13,826
|
15,528
|
10,665
|
|||||||||
Vessel operating expenses
|
85,955
|
88,272
|
86,923
|
|||||||||
Depreciation and amortization of deferred charges (Notes 2(l) and 2(m))
|
81,578
|
76,333
|
70,503
|
|||||||||
General and administrative expenses
|
25,510
|
25,335
|
26,217
|
|||||||||
Management fees to related party (Notes 3(b) and 4(d))
|
1,464
|
405
|
-
|
|||||||||
Gain on contract termination (Note 9(b))
|
(5,500
|
)
|
-
|
-
|
||||||||
Foreign currency gain
|
(253
|
)
|
(984
|
)
|
(528
|
)
|
||||||
Operating loss
|
$
|
(88,321
|
)
|
$
|
(47,177
|
)
|
$
|
(18,204
|
)
|
|||
OTHER INCOME / (EXPENSES):
|
||||||||||||
Interest and finance costs (Note 11)
|
(21,949
|
)
|
(15,555
|
)
|
(8,427
|
)
|
||||||
Interest and other income (Note 4(b))
|
2,410
|
3,152
|
3,627
|
|||||||||
Gain from derivative instruments (Note 14)
|
-
|
-
|
68
|
|||||||||
Gain/(loss) from equity method investments (Note 3)
|
(56,377
|
)
|
(5,133
|
)
|
12,668
|
|||||||
Total other income/(expenses), net
|
$
|
(75,916
|
)
|
$
|
(17,536
|
)
|
$
|
7,936
|
||||
Net loss
|
$
|
(164,237
|
)
|
$
|
(64,713
|
)
|
$
|
(10,268
|
)
|
|||
Dividends on series B preferred shares (Notes 10(a) and 12)
|
(5,769
|
)
|
(5,769
|
)
|
(5,080
|
)
|
||||||
Net loss attributed to common stockholders
|
$
|
(170,006
|
)
|
$
|
(70,482
|
)
|
$
|
(15,348
|
)
|
|||
Loss per common share, basic and diluted
(Note 12)
|
$
|
(2.11
|
)
|
$
|
(0.89
|
)
|
$
|
(0.19
|
)
|
|||
Weighted average number of common shares, basic and diluted
(Note 12)
|
80,441,517
|
79,518,009
|
81,292,290
|
DIANA SHIPPING INC.
|
||||||
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
|
||||||
For the year ended December 31, 2016, 2015 and 2014
|
||||||
(Expressed in thousands of U.S. Dollars)
|
2016
|
2015
|
2014
|
||||||||||
Net loss
|
$
|
(164,237
|
)
|
$
|
(64,713
|
)
|
$
|
(10,268
|
)
|
|||
Other comprehensive income/(loss) (Actuarial gain/(loss))
|
(84
|
)
|
1,016
|
(911
|
)
|
|||||||
Comprehensive loss
|
$
|
(164,321
|
)
|
$
|
(63,697
|
)
|
$
|
(11,179
|
)
|
|||
The accompanying notes are an integral part of these consolidated financial statements.
|
Preferred Stock
|
Common Stock
|
|||||||||||||||||||||||||||||||
# of Shares
|
Par Value
|
# of Shares
|
Par Value
|
Additional Paid-in Capital
|
Other Comprehensive Income / (Loss)
|
Retained Earnings
|
Total Equity
|
|||||||||||||||||||||||||
BALANCE, December 31, 2013
|
-
|
$
|
-
|
82,841,370
|
$
|
828
|
$
|
926,204
|
$
|
164
|
$
|
326,196
|
$
|
1,253,392
|
||||||||||||||||||
|
||||||||||||||||||||||||||||||||
Net loss
|
-
|
$
|
-
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
(10,268
|
)
|
$
|
(10,268
|
)
|
||||||||||||||||
Issuance of series B preferred stock (Note 10(a))
|
2,600,000
|
26
|
-
|
-
|
62,672
|
-
|
-
|
62,698
|
||||||||||||||||||||||||
Issuance of restricted stock and compensation cost (Note 10(c))
|
-
|
-
|
1,864,000
|
19
|
7,725
|
-
|
-
|
7,744
|
||||||||||||||||||||||||
Dividends on series B preferred stock (Note 10(a))
|
-
|
-
|
-
|
-
|
-
|
-
|
(5,080
|
)
|
(5,080
|
)
|
||||||||||||||||||||||
Stock repurchased and retired (Note 10(d))
|
-
|
-
|
(2,845,549
|
)
|
(28
|
)
|
(25,321
|
)
|
-
|
-
|
(25,349
|
)
|
||||||||||||||||||||
Other comprehensive loss
|
-
|
-
|
-
|
-
|
-
|
(911
|
)
|
-
|
(911
|
)
|
||||||||||||||||||||||
BALANCE, December 31, 2014
|
2,600,000
|
$
|
26
|
81,859,821
|
$
|
819
|
$
|
971,280
|
$
|
(747
|
)
|
$
|
310,848
|
$
|
1,282,226
|
|||||||||||||||||
|
||||||||||||||||||||||||||||||||
Net loss
|
-
|
$
|
-
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
(64,713
|
)
|
$
|
(64,713
|
)
|
||||||||||||||||
Issuance of restricted stock and compensation cost (Note 10(c))
|
-
|
-
|
1,100,000
|
10
|
8,269
|
-
|
-
|
8,279
|
||||||||||||||||||||||||
Dividends on series B preferred stock (Note 10(a))
|
-
|
-
|
-
|
-
|
-
|
-
|
(5,769
|
)
|
(5,769
|
)
|
||||||||||||||||||||||
Stock repurchased and retired (Note 10(d))
|
-
|
-
|
(413,804
|
)
|
(4
|
)
|
(2,669
|
)
|
-
|
-
|
(2,673
|
)
|
||||||||||||||||||||
Other comprehensive income
|
-
|
-
|
-
|
-
|
-
|
1,016
|
-
|
1,016
|
||||||||||||||||||||||||
BALANCE, December 31, 2015
|
2,600,000
|
$
|
26
|
82,546,017
|
$
|
825
|
$
|
976,880
|
$
|
269
|
$
|
240,366
|
$
|
1,218,366
|
||||||||||||||||||
|
||||||||||||||||||||||||||||||||
Net loss
|
-
|
$
|
-
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
(164,237
|
)
|
$
|
(164,237
|
)
|
||||||||||||||||
Issuance of restricted stock and compensation cost (Note 10(c))
|
2,150,000
|
22
|
8,291
|
-
|
-
|
8,313
|
||||||||||||||||||||||||||
Dividends on series B preferred stock (Note 10(a))
|
-
|
-
|
-
|
-
|
-
|
-
|
(5,769
|
)
|
(5,769
|
)
|
||||||||||||||||||||||
Other comprehensive loss
|
-
|
-
|
-
|
-
|
-
|
(84
|
)
|
-
|
(84
|
)
|
||||||||||||||||||||||
BALANCE, December 31, 2016
|
2,600,000
|
$
|
26
|
84,696,017
|
$
|
847
|
$
|
985,171
|
$
|
185
|
$
|
70,360
|
$
|
1,056,589
|
||||||||||||||||||
The accompanying notes are an integral part of these consolidated financial statements.
|
2016
|
2015
|
2014
|
||||||||||
Cash Flows from Operating Activities:
|
||||||||||||
Net loss
|
$
|
(164,237
|
)
|
$
|
(64,713
|
)
|
$
|
(10,268
|
)
|
|||
Adjustments to reconcile net loss to net cash provided by / (used in) operating activities:
|
||||||||||||
Depreciation and amortization of deferred charges
|
81,578
|
76,333
|
70,503
|
|||||||||
Amortization of financing costs (Note 11)
|
1,503
|
1,364
|
519
|
|||||||||
Amortization of free lubricants benefit
|
(15
|
)
|
(85
|
)
|
(129
|
)
|
||||||
Compensation cost on restricted stock (Note 10(c))
|
8,313
|
8,279
|
7,744
|
|||||||||
Actuarial gain / (loss)
|
(84
|
)
|
1,016
|
(911
|
)
|
|||||||
Change in fair value of derivative instruments
|
-
|
-
|
(378
|
)
|
||||||||
Gain on shipbuilding contract termination (Note 5)
|
(278
|
)
|
-
|
-
|
||||||||
(Gain)/loss from equity method investments, net of dividends (Note 3)
|
56,377
|
5,133
|
(12,668
|
)
|
||||||||
(Increase) / Decrease in:
|
||||||||||||
Receivables
|
(1,391
|
)
|
1,871
|
(5,682
|
)
|
|||||||
Due from related parties
|
3,334
|
2,070
|
(604
|
)
|
||||||||
Inventories
|
391
|
1,062
|
(1,354
|
)
|
||||||||
Prepaid expenses and other assets
|
620
|
(349
|
)
|
(1,091
|
)
|
|||||||
Other non-current assets
|
-
|
-
|
793
|
|||||||||
Increase / (Decrease) in:
|
||||||||||||
Accounts payable
|
(2,391
|
)
|
(739
|
)
|
2,293
|
|||||||
Due to related parties
|
(39
|
)
|
(217
|
)
|
60
|
|||||||
Accrued liabilities, net of accrued preferred dividends
|
(715
|
)
|
437
|
(11
|
)
|
|||||||
Deferred revenue
|
(1,592
|
)
|
(865
|
)
|
1
|
|||||||
Other liabilities
|
117
|
(643
|
)
|
554
|
||||||||
Drydock costs
|
(2,489
|
)
|
(6,009
|
)
|
(4,461
|
)
|
||||||
Net cash provided by/(used in) Operating Activities
|
$
|
(20,998
|
)
|
$
|
23,945
|
$
|
44,910
|
|||||
Cash Flows from Investing Activities:
|
||||||||||||
Payments for vessel acquisitions, improvements and construction (Notes 5 and 6)
|
(50,911
|
)
|
(155,352
|
)
|
(111,702
|
)
|
||||||
Proceeds from shipbuilding contract termination (Notes 5)
|
9,413
|
-
|
-
|
|||||||||
Acquisition of additional interest in Diana Containerships Inc. (Note 3(a))
|
-
|
-
|
(40,000
|
)
|
||||||||
Cash dividends from investment in Diana Containerships Inc. (Note 3(a))
|
96
|
193
|
763
|
|||||||||
Joint venture investment (Note 3(b))
|
-
|
(267
|
)
|
-
|
||||||||
Payments for plant, property and equipment (Note 7)
|
(217
|
)
|
(211
|
)
|
(1,574
|
)
|
||||||
Net cash used in Investing Activities
|
$
|
(41,619
|
)
|
$
|
(155,637
|
)
|
$
|
(152,513
|
)
|
|||
Cash Flows from Financing Activities:
|
||||||||||||
Proceeds from long-term debt (Note 8)
|
39,265
|
441,173
|
101,500
|
|||||||||
Proceeds from issuance of preferred stock, net of expenses (Note 10(a))
|
-
|
-
|
62,698
|
|||||||||
Cash dividends on preferred stock
|
(5,769
|
)
|
(5,769
|
)
|
(3,862
|
)
|
||||||
Changes in compensating cash balances
|
(1,500
|
)
|
(2,000
|
)
|
(1,500
|
)
|
||||||
Payments for repurchase of common stock (Note 10(d))
|
-
|
(2,673
|
)
|
(25,349
|
)
|
|||||||
Financing costs
|
(466
|
)
|
(5,482
|
)
|
(527
|
)
|
||||||
Loan payments (Note 8)
|
(42,489
|
)
|
(321,240
|
)
|
(48,589
|
)
|
||||||
Net cash provided by / (used in) Financing Activities
|
$
|
(10,959
|
)
|
$
|
104,009
|
$
|
84,371
|
|||||
Net decrease in cash and cash equivalents
|
(73,576
|
)
|
(27,683
|
)
|
(23,232
|
)
|
||||||
Cash and cash equivalents at beginning of the year
|
171,718
|
199,401
|
222,633
|
|||||||||
Cash and cash equivalents at end of the year
|
$
|
98,142
|
$
|
171,718
|
$
|
199,401
|
||||||
SUPPLEMENTAL CASH FLOW INFORMATION
|
||||||||||||
Cash paid during the year for:
|
||||||||||||
Interest, net of amounts capitalized
|
$
|
19,265
|
$
|
13,048
|
$
|
8,180
|
||||||
The accompanying notes are an integral part of these consolidated financial statements.
|
1. |
Basis of Presentation and General Information
|
Charterer
|
2016
|
2015
|
2014
|
|||
A
|
19%
|
24%
|
10%
|
|||
B
|
15%
|
|||||
C
|
10%
|
20%
|
||||
D
|
10%
|
18%
|
||||
E
|
12%
|
12%
|
||||
F
|
10%
|
15%
|
2. |
Significant Accounting Policies
|
Level 1: |
Quoted market prices in active markets for identical assets or liabilities;
|
Level 2: |
Observable market based inputs or unobservable inputs that are corroborated by market data;
|
Level 3: |
Unobservable inputs that are not corroborated by market data.
|
a) |
Diana Containerships Inc. ("Diana Containerships"):
On July 29, 2014, DSI invested $40,000 in Diana Containerships in a private placement. As at December 31, 2016 and 2015, DSI owned 25.73% and 26.08%, respectively, of the share capital of Diana Containerships. On September 30, 2016, the Company reduced the value of the investment to its market value based on Diana Containerships' share price on Nasdaq on that day resulting to an impairment of $17,568. As at December 31, 2016 and 2015, the investment in Diana Containerships amounted to $5,815 and $62,376, respectively, and is included in "Equity method investments" in the accompanying consolidated balance sheets. As at December 31, 2016, the market value of the investment was $6,696 based on Diana Containerships' closing price on Nasdaq of $2.78.
|
b) |
Diana Wilhelmsen Management Limited ("DWM"):
DWM is a joint venture which was established on May 7, 2015 by Diana Ship Management Inc., a wholly owned subsidiary of DSI, and Wilhelmsen Ship Management Holding Limited, an unaffiliated third party, each holding 50% of DWM. As at December 31, 2016, DWM provided management services to seven vessels of the Company's fleet (Note 4(d)). The DWM office is located in Limassol, Cyprus. As at December 31, 2016 and 2015, the investment in DWM amounted to $199 and $111, respectively, and is included in "Equity method investments" in the accompanying consolidated balance sheets. For 2016 and 2015, the investment in DWM resulted in gain of $88 and loss of $156, respectively, included in "Gain/(loss) from equity method investments" in the accompanying consolidated statements of operations.
|
4. |
Transactions with Related Parties
|
5. |
Advances for Vessels under Construction and Acquisitions and Other Vessel Costs
|
2016
|
2015
|
|||||||
Beginning balance
|
$
|
44,514
|
$
|
29,500
|
||||
- Advances for vessels under construction and other vessel costs
|
11,484
|
25,080
|
||||||
- Advances for vessel acquisitions and other vessel costs
|
-
|
40,105
|
||||||
- Reduction due to cancelation of shipbuilding contract
|
(9,135
|
)
|
-
|
|||||
- Transferred to vessel cost (Note 6)
|
-
|
(50,171
|
)
|
|||||
Ending balance
|
$
|
46,863
|
$
|
44,514
|
6. |
Vessels
|
Vessel Cost
|
Accumulated Depreciation
|
Net Book Value
|
||||||||||
|
||||||||||||
Balance, December 31, 2014
|
$
|
1,807,654
|
$
|
(434,521
|
)
|
$
|
1,373,133
|
|||||
|
||||||||||||
- Transfer from advances for vessels under construction and acquisition and other vessel costs (Note 5)
|
50,171
|
-
|
50,171
|
|||||||||
- Acquisitions, improvements and other vessel costs
|
90,167
|
-
|
90,167
|
|||||||||
- Depreciation for the year
|
-
|
(72,668
|
)
|
(72,668
|
)
|
|||||||
Balance, December 31, 2015
|
$
|
1,947,992
|
$
|
(507,189
|
)
|
$
|
1,440,803
|
|||||
|
||||||||||||
- Acquisitions, improvements and other vessel costs
|
39,427
|
-
|
39,427
|
|||||||||
- Depreciation for the year
|
-
|
(76,318
|
)
|
(76,318
|
)
|
|||||||
Balance, December 31, 2016
|
$
|
1,987,419
|
$
|
(583,507
|
)
|
$
|
1,403,912
|
7. |
Property and equipment, net
|
Property and Equipment
|
Accumulated Depreciation
|
Net Book Value
|
||||||||||
|
||||||||||||
Balance, December 31, 2014
|
$
|
26,154
|
$
|
(2,267
|
)
|
$
|
23,887
|
|||||
|
||||||||||||
- Additions in property and equipment
|
211
|
-
|
211
|
|||||||||
- Depreciation for the year
|
-
|
(609
|
)
|
(609
|
)
|
|||||||
Balance, December 31, 2015
|
$
|
26,365
|
$
|
(2,876
|
)
|
$
|
23,489
|
|||||
|
||||||||||||
- Additions in property and equipment
|
217
|
-
|
217
|
|||||||||
- Depreciation for the year
|
-
|
(592
|
)
|
(592
|
)
|
|||||||
Balance, December 31, 2016
|
$
|
26,582
|
$
|
(3,468
|
)
|
$
|
23,114
|
2016
|
2015
|
|||||||
8.5% Senior Unsecured Notes
|
63,250
|
63,250
|
||||||
Secured Term Loans
|
539,467
|
542,691
|
||||||
Total debt outstanding
|
$
|
602,717
|
$
|
605,941
|
||||
Less related deferred financing costs
|
(4,536
|
)
|
(5,870
|
)
|
||||
Total debt, net of deferred financing costs
|
$
|
598,181
|
$
|
600,071
|
||||
Less: Current portion of long term debt, net of deferred financing costs current
|
(65,072
|
)
|
(40,984
|
)
|
||||
Long-term debt, net of current portion and deferred financing costs, non-current
|
$
|
533,109
|
$
|
559,087
|
Period
|
Principal Repayment
|
|||
January 1, 2017 to December 31, 2017
|
$
|
66,470
|
||
January 1, 2018 to December 31, 2018
|
58,737
|
|||
January 1, 2019 to December 31, 2019
|
116,599
|
|||
January 1, 2020 to December 31, 2020
|
163,581
|
|||
January 1, 2021 to December 31, 2021
|
128,678
|
|||
January 1, 2022 and thereafter
|
68,652
|
|||
Total |
$
|
602,717
|
9. |
Commitments and Contingencies
|
a) |
Various claims, suits, and complaints, including those involving government regulations and product liability, arise in the ordinary course of the shipping business. In addition, losses may arise from disputes with charterers, agents, insurance and other claims with suppliers relating to the operations of the Company's vessels. The Company accrues for the cost of environmental and other liabilities when management becomes aware that a liability is probable and is able to reasonably estimate the probable exposure.
|
b) |
In December 2016, the Company, through one of its wholly-owned subsidiaries, upon signing a settlement agreement with former charterers, received an amount of $5,500 as partial payment pursuant to an arbitration award. The partial payment of the arbitration award is without prejudice, and the Company intends to seek the recovery of the balance of the award.
|
c) |
The Company had shipbuilding contracts for the construction of two Newcastlemax dry bulk carriers (Note 5 and 15). As at December 31, 2016, the total obligations under these contracts amounted to $52,440.
|
d) |
As at December 31, 2016, the minimum contractual gross charter revenues expected to be generated from fixed and non-cancelable time charter contracts existing as at December 31, 2016 and until their expiration were as follows:
|
Period
|
Amount
|
|||
Year 1
|
$
|
36,048
|
||
Year 2
|
3,660
|
|||
Total
|
$
|
39,708
|
10. |
Capital Stock and Changes in Capital Accounts
|
Number of Shares
|
Weighted Average Grant Date Price
|
|||||||
Outstanding at December 31, 2013
|
1,358,373
|
$
|
10.25
|
|||||
Granted
|
1,864,000
|
9.38
|
||||||
Vested
|
(730,539
|
)
|
11.25
|
|||||
Outstanding at December 31, 2014
|
2,491,834
|
$
|
9.30
|
|||||
Granted
|
1,100,000
|
6.91
|
||||||
Vested
|
(827,522
|
)
|
9.57
|
|||||
Outstanding at December 31, 2015
|
2,764,312
|
$
|
8.27
|
|||||
Granted
|
2,150,000
|
2.26
|
||||||
Vested
|
(971,646
|
)
|
8.67
|
|||||
Outstanding at December 31, 2016
|
3,942,666
|
$
|
4.89
|
11. |
Interest and Finance Costs
|
2016
|
2015
|
2014
|
||||||||||
Interest expense
|
$
|
19,523
|
$
|
13,922
|
$
|
7,815
|
||||||
Amortization of financing costs
|
1,503
|
1,364
|
519
|
|||||||||
Commitment fees and other costs
|
923
|
269
|
93
|
|||||||||
Total
|
$
|
21,949
|
$
|
15,555
|
$
|
8,427
|
12. |
Loss per Share
|
2016
|
2015
|
2014
|
||||||||||
Net loss
|
$
|
(164,237
|
)
|
$
|
(64,713
|
)
|
$
|
(10,268
|
)
|
|||
Less dividends on series B preferred shares
|
$
|
(5,769
|
)
|
$
|
(5,769
|
)
|
$
|
(5,080
|
)
|
|||
Net loss attributed to common stockholders
|
(170,006
|
)
|
(70,482
|
)
|
(15,348
|
)
|
||||||
Weighted average number of common shares, basic and diluted
|
80,441,517
|
79,518,009
|
81,292,290
|
|||||||||
Loss per share, basic and diluted
|
$
|
(2.11
|
)
|
$
|
(0.89
|
)
|
$
|
(0.19
|
)
|
13. |
Income Taxes
|
14. |
Financial Instruments and Fair Value Disclosures
|
15. |
Subsequent Events
|
1
|
Interpretation
|
1
|
2
|
Facility
|
18
|
3
|
Position of the Lenders, the Swap Bank and the Majority Lenders
|
18
|
4
|
Drawdown
|
20
|
5
|
Interest
|
21
|
6
|
Interest Periods
|
23
|
7
|
Default Interest
|
24
|
8
|
Repayment and Prepayment
|
25
|
9
|
Conditions Precedent
|
28
|
10
|
Representations and Warranties
|
29
|
11
|
General Undertakings
|
32
|
12
|
Corporate Undertakings
|
38
|
13
|
Insurance
|
39
|
14
|
Ship Covenants
|
44
|
15
|
Security Cover
|
48
|
16
|
Payments and Calculations
|
50
|
17
|
Application of Receipts
|
52
|
18
|
Application of Earnings; Swap Payments
|
53
|
19
|
Events of Default
|
54
|
20
|
Fees and Expenses
|
59
|
21
|
Indemnities
|
60
|
22
|
No Set-Off or Tax Deduction
|
63
|
23
|
Illegality, etc.
|
65
|
24
|
Increased Costs
|
65
|
25
|
Set-Off
|
67
|
26
|
Transfers and Changes in Lending Offices
|
68
|
27
|
Variations and Waivers
|
72
|
28
|
Notices
|
73
|
29
|
Joint and Several Liability
|
75
|
30
|
Supplemental
|
76
|
31
|
Confidentiality
|
77
|
32
|
Bail-In
|
79
|
33
|
Law and Jurisdiction
|
79
|
Schedule 1 Lenders and Commitments
|
81
|
|
Schedule 2 Drawdown Notice
|
82
|
|
Schedule 3 Condition Precedent Documents
|
83
|
|
Schedule 4 Transfer Certificate
|
86
|
|
Schedule 5 Designation Notice
|
90
|
|
Execution Pages
|
91
|
(1) |
KABEN SHIPPING COMPANY INC. and TAROA SHIPPING COMPANY INC.,
as joint and several
Borrowers
;
|
(2) |
THE BANKS AND FINANCIAL INSTITUTIONS
listed in Schedule 1, as
Lenders
;
|
(3) |
ABN AMRO BANK N.V.
,
as
Swap Bank
;
|
(4) |
ABN AMRO BANK N.V.
, as
Agent
;
|
(5) |
ABN AMRO BANK N.V.
, as
Arranger
;
and
|
(6) |
ABN AMRO BANK N.V.
, as
Security Trustee.
|
(A) |
The Lenders have agreed to make available to the Borrowers a senior secured term loan facility in an amount of $25,755,000, in a single advance, for the purpose of financing part of the acquisition cost of two dry bulk carriers named respectively "INFINITY9" and "SELINA".
|
(B) |
The Swap Bank has agreed to enter into interest rate swap transactions with the Borrowers from time to time to hedge the Borrowers' exposure under this Agreement to interest rate fluctuations.
|
(C) |
The Lenders and the Swap Bank have agreed to share pari passu in the security to be granted to the Security Trustee pursuant to this Agreement.
|
1 |
INTERPRETATION
|
1.1 |
Definitions
|
(a) |
30 March 2016 (or such later date as the Agent may, with the authorisation of the Majority Lenders, agree with the Borrowers); or
|
(b) |
if earlier, the date on which the Total Commitments are fully borrowed, cancelled or terminated;
|
(a) |
in relation to an EEA Member Country which has implemented, or which at any time implements, Article 55 of Directive 2014/59/EU establishing a framework for the recovery and resolution of credit institutions and investment firms, the relevant
|
(b) |
in relation to any other state, any analogous law or regulation from time to time which requires contractual recognition of any Write-down and Conversion Powers contained in that law or regulation;
|
(a) |
the agreements on capital requirements, a leverage ratio and liquidity standards contained in "Basel III: A global regulatory framework for more resilient banks and banking systems", "Basel III: International framework for liquidity risk measurement, standards and monitoring" and "Guidance for national authorities operating the countercyclical capital buffer" published by the Basel Committee on Banking Supervision in December 2010, each as amended, supplemented or restated; and
|
(b) |
any further guidance or standards published by the Basel Committee on Banking Supervision relating to "Basel III";
|
(a) |
is or becomes public information other than as a direct or indirect result of any breach by a Creditor Party of Clause 31; or
|
(b) |
is identified in writing at the time of delivery as non-confidential by any member of the Group or Security Party or any of its advisers; or
|
(c) |
is known by the Creditor Parties before the date the information is disclosed to it or is lawfully obtained by the Creditor Parties after that date, from a source which is, as far as the Creditor Parties are aware, unconnected with the Group and which, in either case, as far as the Lender is aware, has not been obtained in breach of, and is not otherwise subject to, any obligation of confidentiality;
|
(a) |
it is entered into by the Borrowers pursuant to the Master Agreement with the Swap Bank which, at the time the Transaction is entered into, is also a Lender;
|
(b) |
its purpose is the hedging of all or part of the Borrowers' exposure under this Agreement to fluctuations in LIBOR arising from the funding of the Loan (or any part thereof) for a period expiring no later than the Final Repayment Date; and
|
(c) |
it is designated by the Borrowers, by delivery by the Borrowers to the Agent of a notice of designation in the form set out in Schedule 5, as a Designated Transaction for the purposes of the Finance Documents;
|
(a) |
except to the extent that they fall within paragraph (b);
|
(i) |
all freight, hire and passage moneys;
|
(ii) |
compensation payable to a Borrower or the Security Trustee in the event of requisition of a Ship for hire;
|
(iii) |
remuneration for salvage and towage services;
|
(iv) |
demurrage and detention moneys;
|
(v) |
damages for breach (or payments for variation or termination) of any charterparty or other contract for the employment of a Ship; and
|
(vi) |
all moneys which are at any time payable under any Insurances in respect of loss of hire; and
|
(b) |
if and whenever a Ship is employed on terms whereby any moneys falling within paragraphs (a)(i) to (vi) are pooled or shared with any other person, that proportion of the net receipts of the relevant pooling or sharing arrangement which is attributable to the Ship;
|
(a) |
any claim by any governmental, judicial or regulatory authority which arises out of an Environmental Incident or an alleged Environmental Incident or which relates to any Environmental Law; or
|
(b) |
any claim by any other person which relates to an Environmental Incident or to an alleged Environmental Incident,
|
(a) |
any release of Environmentally Sensitive Material from the Ship; or
|
(b) |
any incident in which Environmentally Sensitive Material is released from a vessel other than a Ship and which involves a collision between a Ship and such other vessel or some other incident of navigation or operation, in either case, in connection with which a Ship is actually or potentially liable to be arrested, attached, detained or injuncted and/or a Ship and/or the Borrower and/or any operator or manager of a Ship is at fault or allegedly at fault or otherwise liable to any legal or administrative action; or
|
(c) |
any other incident in which Environmentally Sensitive Material is released otherwise than from a Ship and in connection with which a Ship is actually or potentially liable to be arrested and/or where any Borrower and/or any operator or manager of a Ship is at fault or allegedly at fault or otherwise liable to any legal or administrative action;
|
(a) |
sections 1471 to 1474 of the Code or any associated regulations;
|
(b) |
any treaty, law or regulation of any other jurisdiction, or relating to an intergovernmental agreement between the US and any other jurisdiction, which (in either case) facilitates the implementation of any law or regulation referred to in paragraph (a) above; or
|
(c) |
any agreement pursuant to the implementation of any treaty, law or regulation referred to in paragraphs (a) or (b) above with the IRS, the US government or any governmental or taxation authority in any other jurisdiction;
|
(a) |
this Agreement;
|
(b) |
the Agency and Trust Agreement;
|
(c) |
the Master Agreement;
|
(d) |
the Master Agreement Assignment;
|
(e) |
the Corporate Guarantee;
|
(f) |
the General Assignments;
|
(g) |
the Mortgages;
|
(h) |
the Account Pledges;
|
(i) |
the Shares Pledges;
|
(j) |
the Initial Charter Assignment;
|
(k) |
the Approved Manager's Undertakings;
|
(l) |
any Charterparty Assignment; and
|
(m) |
any other document (whether creating a Security Interest or not) which is executed at any time by any Borrower, the Corporate Guarantor, the Approved Manager or any other person as security for, or to establish any form of subordination or priorities arrangement in relation to, any amount payable to the Lenders and/or the Swap Bank under this Agreement or any of the other documents referred to in this definition;
|
(a) |
for principal, interest or any other sum payable in respect of any moneys borrowed or raised by the debtor;
|
(b) |
under any loan stock, bond, note or other security issued by the debtor;
|
(c) |
under any acceptance credit, guarantee or letter of credit facility or dematerialised equivalent made available to the debtor;
|
(d) |
under a financial lease, a deferred purchase consideration arrangement or any other agreement having the commercial effect of a borrowing or raising of money by the debtor;
|
(e) |
under any foreign exchange transaction, any interest or currency swap or any other kind of derivative transaction entered into by the debtor or, if the agreement under which any such transaction is entered into requires netting of mutual liabilities, the liability of the debtor for the net amount; or
|
(f) |
under a guarantee, indemnity or similar obligation entered into by the debtor in respect of a liability of another person which would fall within paragraphs (a) to (e) if the references to the debtor referred to the other person;
|
(a) |
all policies and contracts of insurance, including entries of the Ship in any protection and indemnity or war risks association, effected in respect of the Ship, its Earnings or otherwise in relation to the Ship whether before, on or after the date of this Agreement; and
|
(b) |
all rights and other assets relating to, or derived from, any of the foregoing, including any rights to a return of a premium and any rights in respect of any claim whether or not the relevant policy, contract of insurance or entry has expired on or before the date of this Agreement;
|
(a) |
the rate per annum equal to the offered quotation for deposits in Dollars for a period equal to, or as near as possible equal to, the relevant Interest Period which appears on the Screen Rate; or
|
(b) |
if no rate is quoted on the Screen Rate, the rate per annum determined by the Agent to be the rate per annum notified to the Agent by the Reference Bank as the rate at which deposits in Dollars are offered to the Reference Bank by leading banks in the London Interbank Market at the Reference Bank's request at or about 11.00 a.m. (London time) on the Quotation Date for that Interest Period for a period equal to that Interest Period and for delivery on the first Business Day of it,
|
(a) |
before the Loan has been advanced, Lenders whose Commitments total 66.66 per cent. of the Total Commitments; and
|
(b) |
after the Loan has been advanced, Lenders whose Contributions total 66.66 per cent. of the Loan;
|
(a) |
the business, operations, property, condition (financial or otherwise) or prospects of the Borrowers (or any of them) and/or any of the Security Parties and/or the Group; or
|
(b) |
the ability of a Borrower or a Security Party to perform its obligations under the Finance Documents; or
|
(c) |
the validity or enforceability of, or the effectiveness or ranking of any Security Interest granted or purported to be granted pursuant to any of, the Finance Documents or the rights or remedies of any Creditor Party under any of the Finance Documents;
|
(a) |
Security Interests created by the Finance Documents;
|
(b) |
liens for unpaid master's and crew's wages in accordance with usual maritime practice;
|
(c) |
liens for salvage;
|
(d) |
liens arising by operation of law for not more than 2 months' prepaid hire under any charter in relation to a Ship not prohibited by this Agreement;
|
(e) |
liens for master's disbursements incurred in the ordinary course of trading and any other lien arising by operation of law or otherwise in the ordinary course of the operation, repair or maintenance of a Ship, provided such liens do not secure amounts more than 30 days overdue (unless the overdue amount is being contested by the relevant Borrower in good faith by appropriate steps) and subject, in the case of liens for repair or maintenance, to Clause 14.13(g);
|
(f) |
any Security Interest created in favour of a plaintiff or defendant in any proceedings or arbitration as security for costs and expenses where the Borrower is actively prosecuting or defending such proceedings or arbitration in good faith;
|
(g) |
Security Interests arising by operation of law in respect of taxes which are not overdue for payment or in respect of taxes being contested in good faith by appropriate steps and in respect of which appropriate reserves have been made; and
|
(h) |
a right of pledge (and set-off) under and pursuant to the general conditions of ABN AMRO Bank N.V.;
|
(a) |
any Finance Document;
|
(b) |
any policy or contract of insurance contemplated by or referred to in Clause 13 or any other provision of this Agreement or another Finance Document;
|
(c) |
any other document contemplated by or referred to in any Finance Document; and
|
(d) |
any document which has been or is at any time sent by or to a Servicing Bank in contemplation of or in connection with any Finance Document or any policy, contract or document falling within paragraphs (b) or (c);
|
(a) |
England and Wales;
|
(b) |
the country under the laws of which the company is incorporated or formed;
|
(c) |
a country in which the company has the centre of its main interests or in which the company's central management and control is or has recently been exercised;
|
(d) |
a country in which the overall net income of the company is subject to corporation tax, income tax or any similar tax;
|
(e) |
a country in which assets of the company (other than securities issued by, or loans to, related companies) having a substantial value are situated, in which the company maintains a branch or permanent place of business, or in which a Security Interest created by the company must or should be registered in order to ensure its validity or priority; and
|
(f) |
a country the courts of which have jurisdiction to make a winding up, administration or similar order in relation to the company, whether as main or territorial or ancillary proceedings, or which would have such jurisdiction if their assistance were requested by the courts of a country referred to in paragraphs (b) or (c);
|
(a) |
any transaction or matter contemplated by, arising out of, or in connection with a Pertinent Document; or
|
(b) |
any statement relating to a Pertinent Document or to a transaction or matter falling within paragraph (a),
|
(a) |
a mortgage, charge (whether fixed or floating) or pledge, any maritime or other lien or any other security interest of any kind;
|
(b) |
the security rights of a plaintiff under an action
in rem
; and
|
(c) |
any arrangement entered into by a person (A) the effect of which is to place another person (B) in a position which is similar, in economic terms, to the position in which B would have been had he held a security interest over an asset of A; but this paragraph (c) does not apply to a right of set off or combination of accounts conferred by the standard terms of business of a bank or financial institution;
|
(a) |
all amounts which have become due for payment by the Borrowers or any Security Party under the Finance Documents have been paid;
|
(b) |
no amount is owing or has accrued (without yet having become due for payment) under any Finance Document;
|
(c) |
none of the Borrowers nor any Security Party has any future or contingent liability under Clauses 20, 21 or 22 or any other provision of this Agreement or another Finance Document; and
|
(d) |
the Agent, the Security Trustee, the Arranger, the Swap Bank and the Majority Lenders do not consider that there is a significant risk that any payment or transaction under a Finance Document would be set aside, or would have to be reversed or adjusted, in any present or possible future bankruptcy of a Borrower or a Security Party or in any present or possible future proceeding relating to a Finance
|
(a) |
actual, constructive, compromised, agreed or arranged total loss of the Ship;
|
(b) |
any expropriation, confiscation, requisition or acquisition of the Ship, whether for full consideration, a consideration less than its proper value, a nominal consideration or without any consideration, which is effected by any government or official authority or by any person or persons claiming to be or to represent a government or official authority (excluding a requisition for hire for a fixed period not exceeding 1 year without any right to an extension) unless it is within 1 month redelivered to the full control of the Borrower owning that Ship;
|
(c) |
any condemnation of the Ship by any tribunal or by any person or person claiming to be a tribunal; and
|
(d) |
any arrest, capture, seizure or detention of the Ship (including any hijacking or theft) unless it is within 1 month redelivered to the full control of the Borrower owning the Ship;
|
(a) |
in the case of an actual loss of the Ship, the date on which it occurred or, if that is unknown, the date when the Ship was last heard of;
|
(b) |
in the case of a constructive, compromised, agreed or arranged total loss of the Ship, the earliest of:
|
(i) |
the date on which a notice of abandonment is given to the insurers; and
|
(ii) |
the date of any compromise, arrangement or agreement made by or on behalf of the Borrower owning the Ship with the Ship's insurers in which the insurers agree to treat the Ship as a total loss; and
|
(c) |
in the case of any other type of total loss, on the date (or the most likely date) on which it appears to the Agent that the event constituting the total loss occurred;
|
(a) |
in relation to any Bail-In Legislation described in the EU Bail-In Legislation Schedule from time to time, the powers described as such in relation to that Bail-In Legislation in the EU Bail-In Legislation Schedule; and
|
(b) |
in relation to any other applicable Bail-In Legislation:
|
(i) |
any powers under that Bail-In Legislation to cancel, transfer or dilute shares issued by a person that is a bank or investment firm or other financial institution or affiliate of a bank, investment firm or other financial institution, to cancel, reduce, modify or change the form of a liability of such a person or any contract or instrument under which that liability arises, to convert all or part of that liability into shares, securities or obligations of that person or any other person, to provide that any such contract or instrument is to have effect as if a right had been exercised under it or to suspend any obligation in respect of that liability or any of the powers under that Bail-In Legislation that are related to or ancillary to any of those powers; and
|
(ii) |
any similar or analogous powers under that Bail-In Legislation.
|
1.2 |
Construction of certain terms
|
1.3 |
Meaning of
"
month
"
|
(a) |
on the Business Day following the numerically corresponding day if the numerically corresponding day is not a Business Day or, if there is no later Business Day in the same calendar month, on the Business Day preceding the numerically corresponding day; or
|
(b) |
on the last Business Day in the relevant calendar month, if the period started on the last Business Day in a calendar month or if the last calendar month of the period has no numerically corresponding day,
|
1.4 |
General Interpretation
|
(a) |
references to, or to a provision of, a Finance Document or any other document are references to it as amended or supplemented, whether before the date of this Agreement or otherwise;
|
(b) |
references to, or to a provision of, any law include any amendment, extension, re-enactment or replacement, whether made before the date of this Agreement or otherwise;
|
(c) |
words denoting the singular number shall include the plural and vice versa;
|
(d) |
a Potential Event of Default is "continuing" if it has not been remedied or waived and an Event of Default is "continuing" if it has not been waived; and
|
(e) |
Clauses 1.1 to 1.4 apply unless the contrary intention appears.
|
1.5 |
Headings
|
2 |
FACILITY
|
2.1 |
Amount of facility
|
2.2 |
Lenders' participations in Loan
|
2.3 |
Purpose of Loan
|
3 |
POSITION OF THE LENDERS, THE SWAP BANK AND THE MAJORITY LENDERS
|
3.1 |
Interests of Lenders and Swap Bank several
|
(a) |
each Lender shall be entitled to sue for any amount which has become due and payable by the Borrowers to it under this Agreement; and
|
(b) |
the Swap Bank shall be entitled to sue for any amount which has become due and payable by the Borrowers to it under the Master Agreement,
|
3.2 |
Proceedings by individual Lender or Swap Bank
|
(a) |
any other liability or obligation of a Borrower or a Security Party under or connected with a Finance Document; or
|
(b) |
any misrepresentation or breach of warranty by a Borrower or a Security Party in or connected with a Finance Document.
|
3.3 |
Obligations several
|
(a) |
the obligations of the other Lenders or (as the case may be) the Swap Bank being increased; nor
|
(b) |
any Borrower, any Security Party or any other Creditor Party being discharged (in whole or in part) from its obligations under any Finance Document,
|
3.4 |
Parties bound by certain actions of Majority Lenders
|
(a) |
any determination made, or action taken, by the Majority Lenders under any provision of a Finance Document;
|
(b) |
any instruction or authorisation given by the Majority Lenders to the Agent or the Security Trustee under or in connection with any Finance Document (subject always to Clause 27.2); and
|
(c) |
any action taken (or in good faith purportedly taken) by the Agent or the Security Trustee in accordance with such an instruction or authorisation.
|
3.5 |
Reliance on action of Agent
|
(a) |
shall be entitled to assume that the Majority Lenders have duly given any instruction or authorisation which, under any provision of a Finance Document, is required in relation to any action which the Agent has taken or is about to take; and
|
(b) |
shall not be entitled to require any evidence that such an instruction or authorisation has been given.
|
3.6 |
Construction
|
3.7 |
Parallel debt
|
(a) |
Each Borrower irrevocably and unconditionally undertakes to pay to the Security Trustee amounts equal to, and in the currency or currencies of, the Corresponding Debt.
|
(b) |
The Parallel Debt:
|
(i) |
shall become due and payable at the same time as the Corresponding Debt;
|
(ii) |
is independent and separate from, and without prejudice to, the Corresponding Debt.
|
(c) |
For the purposes of this Clause, the Security Trustee:
|
(i) |
is the independent and separate creditor of the Parallel Debt;
|
(ii) |
acts in its own name and not as agent, representative or trustee of the Creditor Parties and its claims in respect of the Parallel Debt shall not be held on trust; and
|
(iii) |
shall have the independent and separate right to demand payment of any or all the Parallel Debt in its own name (including, without limitation, through any suit, execution, enforcement of security, recovery of guarantees and applications for and voting in any kind of insolvency proceeding).
|
(d) |
The Parallel Debt shall be (a) decreased to the extent that the Corresponding Debt has been irrevocably and unconditionally paid or discharged and (b) increased to the extent that the Corresponding Debt has increased, and the Corresponding Debt shall be (x) decreased to the extent that the Parallel Debt has been irrevocably and unconditionally paid or discharged and (y) increased to the extent that the Parallel Debt has increased, in each case provided that the Parallel Debt shall never exceed the Corresponding Debt.
|
(e) |
All amounts received or recovered by the Security Trustee in connection with this Clause, to the extent permitted by applicable law, shall be applied in accordance with Clause 17 (Application of receipts).
|
3.8 |
Lender incorporated or having its registered office in the Federal Republic of Germany
|
(a) |
for the purposes of determining whether approval of the Majority Lenders is obtained the references in the definition of "Majority Lenders" to 66.66 per cent. of the Total Commitments and to 66.66 per cent. of the Loan shall for this purpose be construed to refer to 66.66 per cent. of the Total Commitments or, as the case may be, the Loan only taking account of the other Commitments of, or as the case may be, the participation in the Loan of, the Lenders and ignoring the Commitment of or, as the case may be, the participation in the Loan of, the Lender incorporated or having its registered office in the Federal Republic of Germany; and an action taken by the Majority Lenders as such definition is modified by this paragraph (a) shall be valid in the applicable circumstances and binding all parties; and
|
(b) |
for the purposes of determining whether the approval of all Lenders is obtained, all Lenders shall be construed to mean the other Lenders ignoring the Lender incorporated or having its registered office in the Federal Republic of Germany and an action taken by all Lenders as modified by this paragraph (b) shall be valid in the applicable circumstances and binding on all the parties of this Agreement.
|
4 |
DRAWDOWN
|
4.1 |
Request for the Loan
|
4.2 |
Availability
|
(a) |
the Drawdown Date has to be a Business Day during the Availability Period;
|
(b) |
the amount of the Loan shall not exceed the amount of $25,755,000; and
|
(c) |
the Loan shall be applied in financing part of the acquisition cost of the Ships.
|
4.3 |
Notification to Lenders of receipt of a Drawdown Notice
|
(a) |
the amount of the Loan and the Drawdown Date;
|
(b) |
the amount of that Lender's participation in the Loan; and
|
(c) |
the duration of the first Interest Period.
|
4.4 |
Drawdown Notice irrevocable
|
4.5 |
Lenders to make available Contributions
|
4.6 |
Disbursement of Loan
|
(a) |
to the account which the Borrowers specify in the Drawdown Notice; and
|
(b) |
in the like funds as the Agent received the payments from the Lenders.
|
4.7 |
Disbursement of Loan to third party
|
5 |
INTEREST
|
5.1 |
Payment of normal interest
|
5.2 |
Normal rate of interest
|
5.3 |
Payment of accrued interest
|
5.4 |
Notification of Interest Periods and rates of normal interest
|
(a) |
each rate of interest; and
|
(b) |
the duration of each Interest Period
|
5.5 |
Obligation of Reference Bank to quote
|
5.6 |
Absence of quotations by Reference Bank
|
5.7 |
Market disruption
|
(a) |
no screen rate is quoted in the Screen Rate and the Reference Bank does not, before 1.00 p.m. (London time) on the Quotation Date, provide quotations to the Agent in order to fix LIBOR; or
|
(b) |
at least 1 Business Day before the start of an Interest Period, Lenders having Contributions together amounting to 50 per cent. or more of the Loan (or, if the Loan has not been made, Commitments amounting to 50 per cent. or more of the Total Commitments) notify the Agent that LIBOR fixed by the Agent would not accurately reflect the cost to those Lenders of funding their respective Contributions (or any part of them) during the Interest Period in the London Interbank Market at or about 11.00 a.m. (London time) on the Quotation Date for the Interest Period; or
|
(c) |
at least 1 Business Day before the start of an Interest Period, the Agent is notified by a Lender (the
"Affected Lender"
)
that for any reason it is unable to obtain Dollars in the London Interbank Market in order to fund its Contribution (or any part of it) during the Interest Period.
|
5.8 |
Notification of market disruption
|
5.9 |
Suspension of drawdown
|
(a) |
in a case falling within Clauses 5.7(a) or 5.7(b), the Lenders' obligations to advance the Loan; and
|
(b) |
in a case falling within Clause 5.7(c), the Affected Lender's obligation to participate in the Loan, shall be suspended while the circumstances referred to in the Agent's notice continue.
|
5.10 |
Negotiation of alternative rate of interest
|
5.11 |
Application of agreed alternative rate of interest
|
5.12 |
Alternative rate of interest in absence of agreement
|
5.13 |
Notice of prepayment
|
5.14 |
Prepayment; termination of Commitments
|
(a) |
on the date on which the Agent serves that notice, the Total Commitments or (as the case may require) the Commitment of the Affected Lender shall be cancelled; and
|
(b) |
on the last Business Day of the interest period set by the Agent, the Borrowers shall prepay (without premium or penalty) the Loan or, as the case may be, the Affected Lender's Contribution, together with accrued interest thereon at the applicable rate plus the Margin.
|
5.15 |
Application of prepayment
|
6 |
INTEREST PERIODS
|
6.1 |
Commencement of Interest Periods
|
6.2 |
Duration of normal Interest Periods
|
(a) |
1, 3, 6 or 9 months as notified by the Borrowers to the Agent not later than 11.00 a.m. (Rotterdam time) 3 Business Days before the commencement of the Interest Period
|
(b) |
3 months, if the Borrowers fail to notify the Agent by the time specified in paragraph (a); or
|
(c) |
such other period as the Agent may, with the authorisation of all the Lenders, agree with the Borrowers.
|
6.3 |
Duration of Interest Periods for Repayment Instalments
|
6.4 |
Non-availability of matching deposits for Interest Period selected
|
7 |
DEFAULT INTEREST
|
7.1 |
Payment of default interest on overdue amounts
|
(a) |
the date on which the Finance Documents (or any of them) provide that such amount is due for payment; or
|
(b) |
if a Finance Document provides that such amount is payable on demand, the date on which the demand is served; or
|
(c) |
if such amount has become immediately due and payable under Clause 19.4, the date on which it became immediately due and payable.
|
7.2 |
Default rate of interest
|
(a) |
in the case of an overdue amount of principal, the higher of the rates set out at Clauses 7.3(a) and 7.3(b); or
|
(b) |
in the case of any other overdue amount, the rate set out at Clause 7.3(b).
|
7.3 |
Calculation of default rate of interest
|
(a) |
the rate applicable to the overdue principal amount immediately prior to the relevant date (but only for any unexpired part of any then current Interest Period applicable to it); and
|
(b) |
the aggregate of the Margin plus, in respect of successive periods of any duration (including at call) up to 3 months which the Agent may select from time to time:
|
(i) |
LIBOR; or
|
(ii) |
if the Agent (after consultation with the Reference Bank) determines that Dollar deposits for any such period are not being made available to the Reference Bank by leading banks in the London Interbank Market in the ordinary course of business, a rate from time to time determined by the Agent by reference to the cost of funds to the Reference Bank from such other sources as the Agent (after consultation with the Reference Bank) may from time to time determine.
|
7.4 |
Notification of interest periods and default rates
|
7.5 |
Payment of accrued default interest
|
7.6 |
Compounding of default interest
|
7.7 |
Application to Master Agreement
|
8 |
REPAYMENT AND PREPAYMENT
|
8.1 |
Amount of Repayment Instalments
|
(a) |
8 equal consecutive three-monthly instalments (the
"Repayment Instalments"
and each a
"Repayment Instalment"
)
in the amount of $855,000 each; and
|
(b) |
a balloon instalment in the amount of $18,915,000 (the
"Balloon Instalment"
)
|
8.2 |
Repayment Dates
|
8.3 |
Final Repayment Date
|
8.4 |
Voluntary prepayment
|
8.5 |
Conditions for voluntary prepayment
|
(a) |
a partial prepayment shall be $500,000 or a higher integral multiple of $500,000;
|
(b) |
the Agent has received from the Borrowers at least 5 Business Days prior written notice specifying the amount to be prepaid, the date on which the prepayment is to be made and the manner of application of such prepayment;
|
(c) |
the Borrowers have provided evidence satisfactory to the Agent that any consent required by any Borrower or any Security Party in connection with the prepayment has been obtained and remains in force, and that any requirement relevant to this Agreement which affects any Borrower or any Security Party has been complied with; and
|
(d) |
the Borrowers have complied with Clause 8.12 on or prior to the date of prepayment.
|
8.6 |
Effect of notice of prepayment
|
8.7 |
Notification of notice of prepayment
|
8.8 |
Mandatory prepayment
|
(a) |
a Ship is sold or becomes a Total Loss:
|
(i) |
in the case of a sale, on or before the date on which the Mortgage on that Ship is released; or
|
(ii) |
in the case of a Total Loss, on the earlier of the date falling 180 days after the Total Loss Date and the date of receipt by the Security Trustee of the proceeds of insurance relating to such Total Loss; or
|
(b) |
without the prior written consent of the Agent (to be given on the instructions of the Majority Lenders) there is a Change of Control, on the date on which the Change of Control occurred.
|
(a) |
on the Drawdown Date and ending on 31 December 2018, 100 per cent; and
|
(b) |
1 January 2019 and at all times thereafter, 110 per cent.
|
(a) |
in the case of the sale or Total Loss of a Ship, an amount which, after the application of the prepayment to be made pursuant to Clause 8.8(a), results in the security cover ratio set out in Clause 15.1 being at least equal to the greater of (i) the Applicable Percentage and (ii) the percentage which applied immediately prior to the sale or Total Loss; and
|
(b) |
in the case of a Change of Control, the Loan and all other amounts then outstanding under the Finance Documents in full.
|
8.9 |
Amounts payable on prepayment
|
8.10 |
Application of partial prepayment
|
(a) |
Clause 8.4, shall be applied in the manner specified by the Borrowers in the notice referred to in Clause 8.5(b);
|
(b) |
Clauses 8.8, 8.12, 15.2, 23.3 or 24.5, shall be applied pro rata against the then outstanding Repayment Instalments and the Balloon Instalment; and
|
(c) |
Clause 8.13, 50 per cent of the Excess Cash Flow shall be applied against the Balloon Instalment and the remaining 50 per cent shall be applied against the then outstanding Repayment Instalments on a pro rata basis.
|
8.11 |
No reborrowing
|
8.12 |
Unwinding of Designated Transactions
|
8.13 |
Prepayment out of Excess Earnings
|
(a) |
the aggregate of the Operating Expenses in respect of the Ships during such Cash Sweep Period; and
|
(b) |
the sums incurred by the Borrowers in respect of the payment of principal of, and accrued interest on, the Loan pursuant to this Agreement and any sums paid by the Borrowers pursuant to the Master Agreement, during such Cash Sweep Period,
|
9 |
CONDITIONS PRECEDENT
|
9.1 |
Documents, fees and no default
|
(a) |
that, on or before the service of the Drawdown Notice, the Agent receives:
|
(i) |
the documents described in Part A of Schedule 3 in form and substance satisfactory to the Agent and its lawyers; and
|
(ii) |
payment of any expenses pursuant to Clause 20.2;
|
(b) |
that, on the Drawdown Date but prior to the making of the Loan, the Agent receives or is satisfied that it will receive on the making of the Loan:
|
(i) |
the documents described in Part B of Schedule 3 in form and substance satisfactory to the Agent and its lawyers;
|
(ii) |
payment of the arrangement fee pursuant to Clause 20.1(a) and all accrued commitment fee pursuant to Clause 20.1(b); and
|
(iii) |
payment of any expenses pursuant to Clause 20.2;
|
(c) |
that both at the date of the Drawdown Notice and at the Drawdown Date:
|
(i) |
no Event of Default or Potential Event of Default has occurred or would result from the borrowing of the Loan;
|
(ii) |
the representations and warranties in Clause 10.1 and those of any Borrower or any Security Party which are set out in the other Finance Documents would be true and not misleading if repeated on each of those dates with reference to the circumstances then existing;
|
(iii) |
none of the circumstances contemplated by Clause 5.7 has occurred and is continuing; and
|
(iv) |
there has been no Material Adverse Effect;
|
(d) |
that, if the ratio set out in Clause 15.1 were applied immediately following the making of the Loan, the Borrowers would not be obliged to provide additional security or prepay part of the Loan under that Clause; and
|
(e) |
that the Agent has received, and found to be acceptable to it, any further opinions, consents, agreements and documents in connection with the Finance Documents which the Agent may, with the authorisation of the Majority Lenders, request by notice to the Borrowers prior to the Drawdown Date.
|
9.2 |
Waiver of conditions precedent
|
10 |
REPRESENTATIONS AND WARRANTIES
|
10.1 |
General
|
10.2 |
Status
|
10.3 |
Shares capital and ownership
|
10.4 |
Corporate power
|
(a) |
to carry out its business carried on or to be carried on by it and own its assets owned or to be owned by it;
|
(b) |
to register permanently the Ship owned by it in its name under an Approved Flag;
|
(c) |
to execute the Finance Documents to which that Borrower is a party; and
|
(d) |
to borrow under this Agreement, to enter into Designated Transactions under the Master Agreement and to make all the payments contemplated by, and to comply with, those Finance Documents to which it is a party.
|
10.5 |
Consents in force
|
10.6 |
Legal validity; pari passu ranking; admissibility in evidence; effective Security Interests
|
(a) |
are in full force and effect;
|
(b) |
rank at least pari passu with all its other present and future unsecured liabilities, except for liabilities which are mandatorily preferred by law;
|
(c) |
constitute that Borrower's legal, valid and binding obligations enforceable against that Borrower in accordance with their respective terms; and
|
(d) |
create legal, valid and binding Security Interests enforceable in accordance with their respective terms over all the assets to which they, by their terms, relate, subject to any relevant insolvency laws affecting creditors' rights generally.
|
10.7 |
No third party Security Interests
|
(a) |
each Borrower which is a party to that Finance Document will have the right to create all the Security Interests which that Finance Document purports to create; and
|
(b) |
no third party will have any Security Interest (except for Permitted Security Interests) or any other interest, right or claim over, in or in relation to any asset to which any such Security Interest, by its terms, relates.
|
10.8 |
No conflicts
|
(a) |
any law or regulation; or
|
(b) |
the constitutional documents of that Borrower; or
|
(c) |
any contractual or other obligation or restriction which is binding on that Borrower or any of its assets.
|
10.9 |
No withholding taxes; stamp duty
|
10.10 |
No default
|
10.11 |
Information
|
10.12 |
No litigation
|
10.13 |
Compliance with certain undertakings
|
10.14 |
Taxes paid
|
10.15 |
ISM Code and ISPS Code compliance
|
10.16 |
No money laundering; anti-bribery
|
(a) |
Without prejudice to the generality of Clause 2.3, in relation to the borrowing by the Borrowers of the Loan, the performance and discharge of their obligations and liabilities under the Finance Documents, and the transactions and other arrangements affected or contemplated by the Finance Documents to which a Borrower is a party, the Borrowers confirm (i) that they are acting for their own account; (ii) that they will use the proceeds of the Loan for their own benefit, under their full responsibility and exclusively for the purposes specified in this Agreement; and (iii) that the foregoing will not involve or lead to a contravention of any law, official requirement or other regulatory measure or procedure implemented to combat "money laundering" (as defined in Article 1 of Directive 2005/60/EC of the European Parliament and of the Council).
|
(b) |
The Borrowers will promptly inform the Agent by written notice, if they are not or cease to be the beneficiary and will provide in writing the name and address of the beneficiary.
|
(c) |
The Agent shall promptly notify the Lenders of any written notice it receives under this Clause 10.17.
|
10.17 |
No immunity
|
10.18 |
Title and ownership
|
10.19 |
Pari passu ranking
|
10.20 |
PATRIOT Act
|
10.21 |
Repetition
|
(a) |
Clause 10 shall be deemed to be repeated by the Borrowers:
|
(i) |
on the date of service of the Drawdown Notice;
|
(ii) |
on the Drawdown Date; and
|
(b) |
Clauses 10.2, 10.3, 10.4, 10.6, 10.7, 10.14, 10.17, and 10.20 on the first day of each Interest Period,
|
11 |
GENERAL UNDERTAKINGS
|
11.1 |
General
|
11.2 |
Title; negative pledge and pari passu ranking
|
(a) |
hold the legal title to, and own the entire beneficial interest in the Ship owned by it, her Insurances and her Earnings, free from all Security Interests and other interests and rights of every kind, except for those created by the Finance Documents and the effect of
|
(b) |
not create or permit to arise any Security Interest (except for Permitted Security Interests) over any other asset, present or future (including, but not limited to, that Borrower's rights against the Swap Bank under the Master Agreement or all or any part of that Borrower's interest in any amount payable to that Borrower by the Swap Bank under the Master Agreement); and
|
(c) |
procure that its liabilities under the Finance Documents to which it is a party do and will rank at least pari passu with all its other present and future unsecured liabilities, except for liabilities which are mandatorily preferred by law.
|
11.3 |
No disposal of assets
|
(a) |
all or a substantial part of its assets, whether by one transaction or a number of transactions, whether related or not nor acquire any new assets other than the Ship; or
|
(b) |
any debt payable to it or any other right (present, future or contingent right) to receive a payment, including any right to damages or compensation, but paragraph (a) does not apply to any charter of a Ship as to which Clause 14.13 applies.
|
11.4 |
No other liabilities or obligations to be incurred
|
(a) |
liabilities and obligations under the Finance Documents to which it is a party;
|
(b) |
liabilities or obligations reasonably incurred in the ordinary course of owning, operating and chartering the Ship; and
|
(c) |
in respect of the Designated Transactions.
|
11.5 |
Information provided to be accurate
|
11.6 |
Provision of financial statements
|
(a) |
as soon as possible, but in no event later than 180 days after the end of each Financial Year of the Corporate Guarantor the audited annual consolidated financial statements of the Group for that Financial Year of the Corporate Guarantor (commencing with the financial statements for the year that ended on 31 December 2015);
|
(b) |
as soon as available, but in no event later than 120 days after the end of the 6-month period ending on 30 June and 31 December in each Financial Year of the Corporate Guarantor, the unaudited semi-annual consolidated financial statements of the Group (in the form published in the relevant press release) for that 6-month period (commencing with the financial statements for the 6-month period ending on 30 June 2016) certified as to their correctness by the chief financial officer of the Corporate Guarantor; and
|
(c) |
promptly after each request by the Agent, such further information regarding the financial condition, business and operations of the Borrowers, the Ships, the Security Parties and the Group as the Agent may reasonably require.
|
11.7 |
Form of financial statements
|
(a) |
be prepared in accordance with all applicable laws and GAAP consistently applied;
|
(b) |
give a true and fair view of the state of affairs of the Group at the date of those accounts and of its profit for the period to which those accounts relate; and
|
(c) |
fully disclose or provide for all significant liabilities of the Group.
|
11.8 |
Shareholder and creditor notices
|
11.9 |
Consents and compliance with laws
|
(a) |
for that Borrower to perform its obligations under any Finance Document to which it is a party;
|
(b) |
for the validity or enforceability of any Finance Document to which it is a party;
|
(c) |
for that Borrower to continue to own and operate the Ship owned by it; and
|
(d) |
(without prejudice to its other obligations under the Finance Documents), for that Borrower to comply in all respects, with all laws and regulations to which it may be subject including, without limitation, all Environmental Laws and all intellectual property laws, and that Borrower will comply with the terms of all such consents.
|
11.10 |
Maintenance of Security Interests
|
(a) |
at its own cost, do all that is necessary to ensure that any Finance Document to which it is a party validly creates the obligations and the Security Interests which it purports to create; and
|
(b) |
without limiting the generality of paragraph (a), at its own cost, promptly register, file, record or enrol any Finance Document with any court or authority in all Pertinent Jurisdictions, pay any stamp, registration or similar tax in all Pertinent Jurisdictions in respect of any Finance Document, give any notice or take any other step which, in the opinion of the Majority Lenders, is or has become necessary or desirable for any Finance Document to be valid, enforceable or admissible in evidence or to ensure or protect the priority of any Security Interest which it creates.
|
11.11 |
Notification of litigation
|
11.12 |
No amendment to Master Agreement
|
11.13 |
Principal place of business
|
11.14 |
Confirmation of no default
|
(a) |
states that no Event of Default or Potential Event of Default has occurred; or
|
(b) |
states that no Event of Default or Potential Event of Default has occurred, except for a specified event or matter, of which all material details are given.
|
11.15 |
Notification of default
|
(a) |
the occurrence of an Event of Default or a Potential Event of Default; or
|
(b) |
any matter which indicates that an Event of Default or a Potential Event of Default may have occurred, and will keep the Agent fully up to date with all developments.
|
11.16 |
Provision of further information
|
(a) |
to the Borrowers, the Group, the Corporate Guarantor, any other Security Party, the Ships, the other Fleet Vessels, their Insurances or their Earnings (including, but not limited to, any sales or purchases of any Fleet Vessels, the incurrence of Financial Indebtedness by members of the Group and details of the employment of the Fleet Vessels); or
|
(b) |
to any other matter relevant to, or to any provision of, a Finance Document,
|
11.17 |
Minimum liquidity
|
11.18 |
Provision of copies and translation of documents
|
11.19 |
Sanctions and compliance with laws
|
(a) |
Compliance with laws Each Borrower shall, and shall procure that each other Borrower, each Security Party and each other member of the Group and each Affiliate of any of them shall, comply in all respect with all Sanctions.
|
(b) |
Sanctions
|
(i) |
Each Borrower undertakes that it, and shall procure that each other Borrower, each Security Party and any other member of the Group or any Affiliate of any of them, or any director, officer, agent, employee or person acting on behalf of the foregoing, is not a Restricted Person and does not act directly or indirectly on behalf of a Restricted Person;
|
(ii) |
Each Borrower shall, and shall procure that each other Borrower, each Security Party and any other member of the Group and each Affiliate of any of them shall, not use any revenue or benefit derived from any activity or dealing with a Restricted Person in discharging any obligation due or owing to the Creditor Parties;
|
(iii) |
Each Borrower shall, and shall procure that each other Borrower and each Security Party shall, procure that no proceeds from any activity or dealing with a Restricted Person are credited to any bank account held with any Creditor Party in its name or in the name of any other Borrower or any Security Party or any other member of the Group or any Affiliate of any of them;
|
(iv) |
Each Borrower undertakes that it, and shall procure that each other Borrower and each Security Party and each other member of the Group and each Affiliate of any of them, has taken reasonable measures to ensure compliance with Sanctions;
|
(v) |
Each Borrower shall, and shall procure that each other Borrower, each Security Party and each other member of the Group shall, to the extent permitted by law promptly upon becoming aware of them supply to the Agent details of any claim, action, suit, proceedings or investigation against it with respect to Sanctions by any Sanctions Authority; and
|
(vi) |
Each Borrower shall not, and shall procure that no other Borrower and no Security Party shall, accept, obtain or receive any goods or services from any Restricted Person, except (without limiting Clause 11.19(a) (Compliance with laws)), to the extent relating to any warranties and/or guarantees given and/or liabilities incurred
|
(c) |
Use of proceeds No Borrower shall, and shall procure that no other Borrower or Security Party or member of the Group and any Affiliate of any of them shall, permit or authorise any other person to, directly or indirectly, use, lend, make payments of, contribute or otherwise make available, all or any part of the proceeds of the Loan or other transactions contemplated by this Agreement to fund or facilitate trade, business or other activities: (a) involving or for the benefit of any Restricted Person; or (b) in any other manner that could result in any Security Party or a Creditor Party being in breach of any Sanctions or becoming a Restricted Person.
|
(d) |
Each party to this Agreement acknowledges and agrees that the Borrower does not undertake under paragraphs (a) to (c) (inclusive) above in favour of any Lender incorporated or having its registered office in the Federal Republic of Germany and no such Lender shall have any right thereunder and shall be deemed not to be a party to the provisions of this Clause 11.19.
|
11.20 |
"Know your customer" checks
|
(a) |
the introduction of or any change in (or in the interpretation, administration or application of) any law or regulation made after the date of this Agreement;
|
(b) |
any change in the status of any Borrower or any Security Party after the date of this Agreement; or
|
(c) |
a proposed assignment or transfer by a Lender of any of its rights and obligations under this Agreement to a party that is not a Lender prior to such assignment or transfer,
|
11.21 |
Ownership
|
11.22 |
Notification of non-compliance with financial covenants
|
12 |
CORPORATE UNDERTAKINGS
|
12.1 |
General
|
12.2 |
Maintenance of status
|
12.3 |
Negative undertakings
|
(a) |
carry on any business other than the ownership, chartering and operation of the Ship owned by that Borrower; or
|
(b) |
pay any dividend or make any other form of distribution or effect any form of redemption, purchase or return of share capital:
|
(i) |
during the Cash Sweep Period; and/or
|
(ii) |
if an Event of Default has occurred and is continuing at any relevant time or an Event of Default would result from the payment of such dividend or the making of such distribution;
|
(c) |
provide any form of credit or financial assistance to:
|
(i) |
a person who is directly or indirectly interested in that Borrower's share or loan capital; or
|
(ii) |
any company in or with which such a person is directly or indirectly interested or connected,
|
(d) |
open or maintain any account with any bank or financial institution except accounts with the Agent for the purposes of the Finance Documents; or
|
(e) |
issue, allot or grant any person a right to any shares in its capital or repurchase or reduce its issued share capital; or
|
(f) |
acquire any shares or other securities other than US or UK Treasury bills and certificates of deposit issued by major North American or European banks, or enter into any transaction in a derivative other than the Designated Transactions; or
|
(g) |
enter into any form of amalgamation, merger or de-merger or any form of reconstruction or reorganisation; or
|
(h) |
change its constitutional documents; or
|
(i) |
acquire any vessel other than the Ship owned by it.
|
13 |
INSURANCE
|
13.1 |
General
|
13.2 |
Maintenance of obligatory insurances
|
(a) |
fire and usual marine risks (including increased value, hull and machinery and excess risks);
|
(b) |
war risks;
|
(c) |
protection and indemnity risks (including excess war risk P&I cover); and
|
(d) |
any other risks against which the Security Trustee considers, having regard to practices and other circumstances prevailing at the relevant time, it would in the opinion of the Security Trustee be reasonable for that Borrower to insure and which are specified by the Security Trustee by notice to that Borrower.
|
13.3 |
Terms of obligatory insurances
|
(a) |
in Dollars;
|
(b) |
in the case of fire and usual marine risks and war risks, in an amount on an agreed value basis at least the greater of (i) an amount which when aggregated with the insured value of the other Ships then subject to a Mortgage, 120 per cent of the aggregate of the Loan and the Swap Exposure (if any) and (ii) the Market Value of the Ship owned by it;
|
(c) |
in the case of oil pollution liability risks, for an aggregate amount equal to the highest level of cover from time to time available under basic protection and indemnity club entry and in the international marine insurance market;
|
(d) |
in relation to protection and indemnity risks in respect of the full tonnage of the Ship;
|
(e) |
on approved terms; and
|
(f) |
through approved brokers and with approved insurance companies and/or underwriters or, in the case of war risks and protection and indemnity risks, in approved war risks and protection and indemnity risks associations.
|
13.4 |
Further protections for the Creditor Parties
|
(a) |
subject always to paragraph (b), name that Borrower as the sole named assured unless the interest of every other named assured is limited:
|
(i) |
in respect of any obligatory insurances for hull and machinery and war risks:
|
(A) |
to any provable out-of-pocket expenses that it has incurred and which form part of any recoverable claim on underwriters; and
|
(B) |
to any third party liability claims where cover for such claims is provided by the policy (and then only in respect of discharge of any claims made against it); and
|
(ii) |
in respect of any obligatory insurances for protection and indemnity risks, to any recoveries it is entitled to make by way of reimbursement following discharge of any third party liability claims made specifically against it,
|
(b) |
whenever the Security Trustee requires, name (or be amended to name) the Security Trustee as additional named assured for its rights and interests, warranted no operational interest and with full waiver of rights of subrogation against the Security Trustee, but without the Security Trustee thereby being liable to pay (but having the right to pay) premiums, calls or other assessments in respect of such insurance;
|
(c) |
name the Security Trustee as loss payee with such directions for payment as the Security Trustee may specify;
|
(d) |
provide that all payments by or on behalf of the insurers under the obligatory insurances to the Security Trustee shall be made without set-off, counterclaim or deductions or condition whatsoever;
|
(e) |
provide that such obligatory insurances shall be primary without right of contribution from other insurances which may be carried by the Security Trustee or any other Creditor Party; and
|
(f) |
provide that the Security Trustee may make proof of loss if that Borrower fails to do so.
|
13.5 |
Renewal of obligatory insurances
|
(a) |
at least 21 days before the expiry of any obligatory insurance effected by it: notify the Security Trustee of the brokers (or other insurers) and any protection and indemnity or war risks association through or with whom that Borrower proposes to renew that obligatory insurance and of the proposed terms of renewal; and (ii)obtain the Security Trustee's approval to the matters referred to in paragraph (i);
|
(b) |
at least 14 days before the expiry of any obligatory insurance, renew that obligatory insurance in accordance with the Security Trustee's approval pursuant to paragraph (a); and
|
(c) |
procure that the approved brokers and/or the war risks and protection and indemnity associations with which such a renewal is effected shall promptly after the renewal notify the Security Trustee in writing of the terms and conditions of the renewal.
|
13.6 |
Copies of policies; letters of undertaking
|
(a) |
they will have endorsed on each policy, immediately upon issue, a loss payable clause and a notice of assignment complying with the provisions of Clause 13.4;
|
(b) |
they will hold such policies, and the benefit of such insurances, to the order of the Security Trustee in accordance with the said loss payable clause;
|
(c) |
they will advise the Security Trustee immediately of any material change to the terms of the obligatory insurances;
|
(d) |
they will notify the Security Trustee, not less than 14 days before the expiry of the obligatory insurances, in the event of their not having received notice of renewal instructions from that Borrower or its agents and, in the event of their receiving instructions to renew, they will promptly notify the Security Trustee of the terms of the instructions; and
|
(e) |
they will not set off against any sum recoverable in respect of a claim relating to the Ship owned by that Borrower under such obligatory insurances any premiums or other amounts due to them or any other person whether in respect of that Ship or otherwise, they waive any lien on the policies, or any sums received under them, which they might have in respect of such premiums or other amounts, and they will not cancel such obligatory insurances by reason of non-payment of such premiums or other amounts, and will arrange for a separate policy to be issued in respect of that Ship forthwith upon being so requested by the Security Trustee.
|
13.7 |
Copies of certificates of entry
|
(a) |
a certified copy of the certificate of entry for that Ship owned by it;
|
(b) |
a letter or letters of undertaking in such form as may be required by the Security Trustee;
|
(c) |
where required to be issued under the terms of insurance/indemnity provided by a Borrower's protection and indemnity association, a certified copy of each US voyage quarterly declaration (or other similar document or documents) made by that Borrower in accordance with the requirements of such protections and indemnity association; and
|
(d) |
a certified copy of each certificate of financial responsibility for pollution by oil or other Environmentally Sensitive Material issued by the relevant certifying authority in relation to that Ship.
|
13.8 |
Deposit of original policies
|
13.9 |
Payment of premiums
|
13.10 |
Guarantees
|
13.11 |
Compliance with terms of insurances
|
(a) |
each Borrower shall take all necessary action and comply with all requirements which may from time to time be applicable to the obligatory insurances, and (without limiting the obligation contained in Clause 13.6(c)) ensure that the obligatory insurances are not made subject to any exclusions or qualifications to which the Security Trustee has not given its prior approval;
|
(b) |
no Borrower shall make any changes relating to the classification or classification society or manager or operator of the Ship owned by it approved by the underwriters of the obligatory insurances;
|
(c) |
each Borrower shall make (and promptly supply copies to the Agent of) all quarterly or other voyage declarations which may be required by the protection and indemnity risks association in which the Ship owned by it is entered to maintain cover for trading to the US and Exclusive Economic Zone (as defined in the United States Oil Pollution Act 1990 or any other applicable legislation); and
|
(d) |
no Borrower shall employ the Ship owned by it, nor allow it to be employed, otherwise than in conformity with the terms and conditions of the obligatory insurances, without first obtaining the consent of the insurers and complying with any requirements (as to extra premium or otherwise) which the insurers specify.
|
13.12 |
Alteration to terms of insurances
|
13.13 |
Settlement of claims
|
13.14 |
Provision of copies of communications
|
(a) |
the approved brokers;
|
(b) |
the approved protection and indemnity and/or war risks associations; and
|
(c) |
the approved insurance companies and/or underwriters, which relate directly or indirectly to:
|
(i) |
that Borrower's obligations relating to the obligatory insurances including, without limitation, all requisite declarations and payments of additional premiums or calls; and
|
(ii) |
any credit arrangements made between that Borrower and any of the persons referred to in paragraphs (a) or (b) relating wholly or partly to the effecting or maintenance of the obligatory insurances; and
|
(iii) |
a claim under any obligatory insurances of the Ship owned by it.
|
13.15 |
Provision of information
|
(a) |
obtaining or preparing any report from an independent marine insurance broker as to the adequacy of the obligatory insurances effected or proposed to be effected; and/or
|
(b) |
effecting, maintaining or renewing any such insurances as are referred to in Clause 13.16 or dealing with or considering any matters relating to any such insurances, and the Borrowers shall, forthwith upon demand, indemnify the Security Trustee in respect of all fees and other expenses incurred by or for the account of the Security Trustee in connection with any such report as is referred to in paragraph (a).
|
13.16 |
Mortgagee's interest, marine insurance and additional perils insurance
|
13.17 |
Review of insurance requirements
|
13.18 |
Modification of insurance requirements
|
13.19 |
Compliance with mortgagee's instructions
|
14 |
SHIP COVENANTS
|
14.1 |
General
|
14.2 |
Ship's name and registration
|
14.3 |
Repair and classification
|
(a) |
consistent with first class ship ownership and management practice;
|
(b) |
so as to maintain the highest class free of overdue recommendations and conditions with a classification society which is a member of IACS acceptable to the Agent (such acceptance not to be unreasonably withheld); and
|
(c) |
so as to comply with all laws and regulations applicable to vessels registered at ports in the applicable Approved Flag State or to vessels trading to any jurisdiction to which that Ship may trade from time to time, including but not limited to the ISM Code and the ISPS Code.
|
14.4 |
Classification society undertaking
|
(a) |
to send to the Security Trustee, following receipt of a written request from the Security Trustee, certified true copies of all original class records held by the classification society in relation to its Ship;
|
(b) |
to allow the Security Trustee (or its agents), at any time and from time to time, to inspect the original class and related records of that Borrower and its Ship at the offices of the classification society and to take copies of them;
|
(c) |
to notify the Security Trustee immediately in writing if the classification society:
|
(i) |
receives notification from that Borrower or any other person that its Ship's classification society is to be changed; or
|
(ii) |
becomes aware of any facts or matters which may result in or have resulted in a change, suspension, discontinuance, withdrawal or expiry of that Ship's class under the rules or terms and conditions of that Borrower's or its Ship's membership of the classification society; and
|
(d) |
following receipt of a written request from the Security Trustee:
|
(i) |
to confirm that a Borrower is not in default of any of its contractual obligations or liabilities to the classification society and, without limiting the foregoing, that it has paid in full all fees or other charges due and payable to the classification society; or
|
(ii) |
if a Borrower is in default of any of its contractual obligations or liabilities to the classification society, to specify to the Security Trustee in reasonable detail the facts and circumstances of such default, the consequences of such default, and any remedy period agreed or allowed by the classification society.
|
14.5 |
Modification
|
14.6 |
Removal of parts
|
14.7 |
Surveys
|
14.8 |
Inspection
|
14.9 |
Prevention of and release from arrest
|
(a) |
all liabilities which give or may give rise to maritime or possessory liens on or claims enforceable against the Ship owned by it, the Earnings or the Insurances;
|
(b) |
all taxes, dues and other amounts charged in respect of the Ship owned by it, the Earnings or the Insurances; and
|
(c) |
all other outgoings whatsoever in respect of the Ship owned by it, the Earnings or the Insurances,
|
14.10 |
Compliance with laws etc.
|
(a) |
comply, or procure compliance with the ISM Code, the ISPS Code, all Environmental Laws, all Sanctions and all other laws or regulations relating to the Ship owned by it, its ownership, operation and management or to the business of that Borrower;
|
(b) |
not employ the Ship owned by it nor allow its employment in any manner contrary to any law or regulation in any relevant jurisdiction including but not limited to the ISM Code, the ISPS Code and all Sanctions;
|
(c) |
in the event of hostilities in any part of the world (whether war is declared or not), not cause or permit the Ship owned by it to enter or trade to any zone which is declared a war zone by any government or by the Ship's war risks insurers unless the prior written consent of the Security Trustee has been given and that Borrower has (at its expense) effected any special, additional or modified insurance cover which the Security Trustee may require; and
|
(d) |
comply with the PATRIOT Act and the United States Foreign Corrupt Practices Act.
|
14.11 |
Provision of information
|
(a) |
the Ship owned by it, its employment, position and engagements;
|
(b) |
the Earnings and payments and amounts due to the master and crew of the Ship owned by it;
|
(c) |
any expenses incurred, or likely to be incurred, in connection with the operation, maintenance or repair of the Ship owned by it and any payments made in respect of that Ship;
|
(d) |
any towages and salvages; and
|
(e) |
its compliance, the Approved Manager's compliance and the compliance of the Ship owned by it with the ISM Code, the ISPS Code and Sanctions, and, upon the Security Trustee's request, provide copies of any current charter relating to the Ship owned by it , of any current charter guarantee and copies of that Borrower's or the Approved Manager's Document of Compliance.
|
14.12 |
Notification of certain events
|
(a) |
any casualty which is or is likely to be or to become a Major Casualty;
|
(b) |
any occurrence as a result of which the Ship owned by it has become or is, by the passing of time or otherwise, likely to become a Total Loss;
|
(c) |
any requirement or recommendation made by any insurer or classification society or by any competent authority which is not immediately complied with;
|
(d) |
any arrest or detention of the Ship owned by it, any exercise or purported exercise of any lien on that Ship or its Earnings or any requisition of that Ship for hire;
|
(e) |
any intended dry docking of the Ship owned by it;
|
(f) |
any Environmental Claim made against that Borrower or in connection with the Ship owned by it, or any Environmental Incident;
|
(g) |
any claim for breach of the ISM Code or the ISPS Code being made against that Borrower, the Approved Manager or otherwise in connection with the Ship owned by it; or
|
(h) |
any other matter, event or incident, actual or threatened, the effect of which will or could lead to the ISM Code or the ISPS Code not being complied with, and that Borrower shall keep the Security Trustee advised in writing on a regular basis and in such detail as the Security Trustee shall require of that Borrower's, the Approved Manager's or any other person's response to any of those events or matters.
|
14.13 |
Restrictions on chartering, appointment of managers etc.
|
(a) |
let that Ship on demise charter for any period;
|
(b) |
enter into any time or consecutive voyage charter in respect of that Ship for a term which exceeds, or which by virtue of any optional extensions may exceed, 12 months;
|
(c) |
enter into any charter in relation to that Ship under which more than 2 months' hire (or the equivalent) is payable in advance;
|
(d) |
charter that Ship otherwise than on bona fide arm's length terms at the time when that Ship is fixed;
|
(e) |
appoint a manager of that Ship other than the Approved Manager or agree to any alteration to the terms of the Approved Manager's appointment;
|
(f) |
de activate or lay up that Ship; or
|
(g) |
put that Ship into the possession of any person for the purpose of work being done upon it in an amount exceeding or likely to exceed 1,000,000 (or the equivalent in any other currency) unless that person has first given to the Security Trustee and in terms satisfactory to it a written undertaking not to exercise any lien on that Ship or its Earnings for the cost of such work or for any other reason.
|
14.14 |
Notice of Mortgage
|
14.15 |
Sharing of Earnings
|
(a) |
enter into any agreement or arrangement for the sharing of any Earnings; or
|
(b) |
enter into any agreement or arrangement for the postponement of any date on which any Earnings are due, the reduction of the amount of any Earnings or otherwise for the release or adverse alteration of any right of a Borrower to any Earnings.
|
14.16 |
ISPS Code
|
(a) |
procure that the Ship owned by that Borrower and the company responsible for that Ship's compliance with the ISPS Code comply with the ISPS Code;
|
(b) |
maintain for that Ship an ISSC; and
|
(c) |
notify the Agent immediately in writing of any actual or threatened withdrawal, suspension, cancellation or modification of the ISSC.
|
14.17 |
Charterparty Assignment
|
(a) |
serve notice of the Charterparty Assignment on the relevant charterer procure that the charterer acknowledges such notice in such form as the Agent may approve or require; and
|
(b) |
deliver to the Agent such other documents equivalent to those referred to at paragraphs 3, 4 and 5 of Schedule 3, Part A as the Agent may require.
|
14.18 |
Responsible Ship Recycling
|
15 |
SECURITY COVER
|
15.1 |
Minimum required security cover
|
(a) |
the aggregate of the Market Value of the Ships; plus
|
(b) |
the net realisable value of any additional security previously provided under this Clause 15, is below the Relevant Percentage of the aggregate of (i) the Loan and (ii) any Swap Exposure. In this Clause 15,1
"Relevant Percentage"
means:
|
(i) |
from 1 January 2017 up to and including 31 December 2017, 90 per. cent;
|
(ii) |
from 1 January 2018 up to and including 31 December 2018, 100 per. cent; and
|
(iii) |
from 1 January 2019 and at all times thereafter, 110 per. cent.
|
15.2 |
Provision of additional security; prepayment
|
15.3 |
Valuation of Ships
|
(a) |
as at a date not more than 14 days previously;
|
(b) |
by an Approved Broker (selected by the Borrowers and approved by the Agent);
|
(c) |
addressed to the Agent;
|
(d) |
with or without physical inspection of the Ship (as the Agent may require);
|
(e) |
on the basis of a sale for prompt delivery for cash on normal arm's length commercial terms as between a willing seller and a willing buyer, free of any existing charter or other contract of employment; and
|
(f) |
after deducting the estimated amount of the usual and reasonable expenses which would be incurred in connection with the sale,
|
15.4 |
Value of additional vessel security
|
15.5 |
Valuations binding
|
15.6 |
Provision of information
|
15.7 |
Frequency of valuations
|
15.8 |
Payment of valuation expenses
|
15.9 |
Application of prepayment
|
16 |
PAYMENTS AND CALCULATIONS
|
16.1 |
Currency and method of payments
|
(a) |
by not later than 11.00 a.m. (New York City time) on the due date;
|
(b) |
in same day Dollar funds settled through the New York Clearing House Interbank Payments System (or in such other Dollar funds and/or settled in such other manner as the Agent shall specify as being customary at the time for the settlement of international transactions of the type contemplated by this Agreement);
|
(c) |
in the case of an amount payable by a Lender to the Agent or by any Borrower to the Agent or any Lender, to the account of the Agent with correspondent bank Bank of America Intl. New York (correspondent bank SWIFT: BOFAUS3N (SWIFT: ABNANL2A, beneficiary: ABN AMRO Bank N.V. Amsterdam and account number: [CJ) with reference "$25,755,000 facility re m.vs INFINITY9 and SELINA", or to such other account with such other bank as the Agent may from time to time notify to the Borrowers and the other Creditor Parties; and
|
(d) |
in the case of an amount payable to the Security Trustee, to such account as it may from time to time notify to the Borrowers and the other Creditor Parties.
|
16.2 |
Payment on non-Business Day
|
(a) |
the due date shall be extended to the next succeeding Business Day; or
|
(b) |
if the next succeeding Business Day falls in the next calendar month, the due date shall be brought forward to the immediately preceding Business Day,
|
16.3 |
Basis for calculation of periodic payments
|
16.4 |
Distribution of payments to Creditor Parties
|
(a) |
any amount received by the Agent under a Finance Document for distribution or remittance to a Lender, the Swap Bank or the Security Trustee shall be made available by the Agent to that Lender, the Swap Bank or, as the case may be, the Security Trustee by payment, with funds having the same value as the funds received, to such account as the Lender, the Swap Bank or the Security Trustee may have notified to the Agent not less than 5 Business Days previously; and
|
(b) |
amounts to be applied in satisfying amounts of a particular category which are due to the Lenders and/or the Swap Bank generally shall be distributed by the Agent to each Lender and the Swap Bank pro rata to the amount in that category which is due to it.
|
16.5 |
Permitted deductions by Agent
|
16.6 |
Agent only obliged to pay when monies received
|
16.7 |
Refund to Agent of monies not received
|
(a) |
refund the sum in full to the Agent; and
|
(b) |
pay to the Agent the amount (as certified by the Agent) which will indemnify the Agent against any funding or other loss, liability or expense incurred by the Agent as a result of making the sum available before receiving it.
|
16.8 |
Agent may assume receipt
|
16.9 |
Creditor Party accounts
|
16.10 |
Agent's memorandum account
|
16.11 |
Accounts prima facie evidence
|
17 |
APPLICATION OF RECEIPTS
|
17.1 |
Normal order of application
|
(a) |
FIRST: in or towards satisfaction of any amounts then due and payable under the Finance Documents in the following order and proportions:
|
(i) |
firstly, in or towards satisfaction pro rata of all amounts then due and payable to the Creditor Parties under the Finance Documents other than those amounts referred to at paragraphs (ii) and (iii) (including, but without limitation, all amounts payable by any Borrower under Clauses 20, 21 and 22 of this Agreement or by any Borrower or any Security Party under any corresponding or similar provision in any other Finance Document); secondly, in or towards satisfaction pro rata of any and all amounts of interest or default interest payable to the Creditor Parties under the Finance Documents (and, for this purpose, the expression
"interest"
shall include any net amount which any Borrower shall have become liable to pay or deliver under section 2(e) (Obligations) of the Master Agreement but shall have failed to pay or deliver to the Swap Bank at the time of application or distribution under this Clause 17); and (iii)thirdly, in or towards satisfaction pro rata of the Loan and the Swap Exposure (in the case of the latter, calculated as at the actual Early Termination Date applying to each particular Designated Transaction, or if no such Early Termination Date shall have occurred, calculated as if an Early Termination Date occurred on the date of application or distribution hereunder);
|
(b) |
SECONDLY: in retention of an amount equal to any amount not then due and payable under any Finance Document but which the Agent, by notice to any Borrower, the Security Parties and the other Creditor Parties, states in its opinion will or may become due and payable in the future and, upon those amounts becoming due and payable, in or towards satisfaction of them in accordance with the provisions of Clause 17.1(a); and
|
(c) |
THIRDLY: any surplus shall be paid to the Borrowers or to any other person appearing to be entitled to it.
|
17.2 |
Variation of order of application
|
17.3 |
Notice of variation of order of application
|
17.4 |
Appropriation rights overridden
|
18 |
APPLICATION OF EARNINGS; SWAP PAYMENTS
|
18.1 |
Payment of Earnings
|
(a) |
(and subject only to the provisions of the General Assignments) all Earnings of the Ship owned by it are paid to the Earnings Account for that Ship; and
|
(b) |
all payments by the Swap Bank to the Borrowers under each Designated Transaction are paid to the Earnings Accounts (or any of them).
|
18.2 |
Location of accounts
|
(a) |
comply with any requirement of the Agent as to the location or re-location of the Accounts (or any of them); and
|
(b) |
execute any documents which the Agent specifies to create or maintain in favour of the Security Trustee a Security Interest over (and/or rights of set-off, consolidation or other rights in relation to) the Accounts (or any of them).
|
18.3 |
Debits for expenses etc.
|
18.4 |
Borrowers' obligations unaffected
|
(a) |
the liability of the Borrowers to make payments of principal and interest on the due dates; or
|
(b) |
any other liability or obligation of the Borrowers or any Security Party under any Finance Document.
|
18.5 |
Earnings Accounts Balances
|
19 |
EVENTS OF DEFAULT
|
19.1 |
Events of Default
|
(a) |
any Borrower or any Security Party fails to pay when due or (if so payable) on demand any sum payable under a Finance Document or under any document relating to a Finance Document unless such failure is caused by an administrative or technical error or any other event which disrupts any applicable payment or communication system and is beyond the control of the Borrowers (or any of them) or any Security Party and in which case the payment is made within 3 Business Days of its due date; or
|
(b) |
any breach occurs of Clause 9.2, 10.16, 10.17, 10.21, 11.2, 11.3, 11.9, 11.17, 11.19, 12.2, 12.3, 13.2, 13.3, 14.2 or 15.2 of this Agreement or clause 12.3 of the Corporate Guarantee; or
|
(c) |
any breach by any Borrower or any Security Party occurs of any provision of a Finance Document (other than a breach covered by paragraphs (a) or (b)) which, in the opinion of the Majority Lenders, is capable of remedy, and such default continues unremedied 10 days after written notice from the Agent requesting action to remedy the same; or
|
(d) |
(subject to any applicable grace period specified in any Finance Document) any breach by any Borrower or any Security Party occurs of any provision of a Finance Document (other than a breach falling within paragraphs (a), (b) or (c)); or
|
(e) |
any representation, warranty or statement made or repeated by, or by an officer of, a Borrower or a Security Party in a Finance Document or in a Drawdown Notice or any other notice or document relating to a Finance Document is untrue or misleading when it is made or repeated; or any of the following occurs in relation to any Financial Indebtedness of a Relevant Person (in the case of all Relevant Persons (taken as a whole) exceeding in aggregate $5,000,000 (or the equivalent in any other currency) at any relevant time
Provided that
in the case of each Borrower, individually, any Financial Indebtedness exceeding $500,000 (or the equivalent in any other currency)):
|
(i) |
any Financial Indebtedness of a Relevant Person is not paid when due; or
|
(ii) |
any Financial Indebtedness of a Relevant Person becomes due and payable or capable of being declared due and payable prior to its stated maturity date as a consequence of any event of default; or
|
(iii) |
a lease, hire purchase agreement or charter creating any Financial Indebtedness of a Relevant Person is terminated by the lessor or owner or becomes capable of being terminated as a consequence of any termination event; or
|
(iv) |
any overdraft, loan, note issuance, acceptance credit, letter of credit, guarantee, foreign exchange or other facility, or any swap or other derivative contract or transaction, relating to any Financial Indebtedness of a Relevant Person ceases to be available or becomes capable of being terminated as a result of any event of default, or cash cover is required, or becomes capable of being required, in respect of such a facility as a result of any event of default; or
|
(v) |
any Security Interest securing any Financial Indebtedness of a Relevant Person becomes enforceable; or
|
(g) |
any of the following occurs in relation to a Relevant Person:
|
(i) |
a Relevant Person becomes, in the opinion of the Majority Lenders, unable to pay its debts as they fall due; or
|
(ii) |
any assets of a Relevant Person are subject to any form of execution, attachment, arrest, sequestration or distress or any form of freezing order in respect of a sum of, or sums exceeding, in aggregate, in the case of all Relevant Persons (taken as a whole) $5,000,000 (or the equivalent in any other currency) at any relevant time
Provided that
in the case of each Borrower, individually, any sum of, or sums exceeding, in aggregate $500,000 (or the equivalent in any other currency and
Provided further
that in the case of an arrest of a Ship, no Event of Default shall occur under this paragraph (ii) if the arrest is discharged, dismissed or released within 60 days of commencement;
|
(iii) |
any administrative or other receiver is appointed over any asset of a Relevant Person; or
|
(iv) |
an administrator is appointed (whether by the court or otherwise) in respect of a Relevant Person; or
|
(v) |
any formal declaration of bankruptcy or any formal statement to the effect that a Relevant Person is insolvent or likely to become insolvent is made by a Relevant Person or by the directors of a Relevant Person or, in any proceedings, by a lawyer acting for a Relevant Person; or
|
(vi) |
a provisional liquidator is appointed in respect of a Relevant Person, a winding up order is made in relation to a Relevant Person or a winding up resolution is passed by a Relevant Person; or
|
(vii) |
a resolution is passed, an administration notice is given or filed, an application or petition to a court is made or presented or any other step is taken by (aa) a Relevant Person, (bb) the members or directors of a Relevant Person, (cc) a holder of Security Interests which together relate to all or substantially all of the assets of a Relevant Person, or (dd) a government minister or public or regulatory authority of a Pertinent Jurisdiction for or with a view to the winding up of that or another Relevant Person or the appointment of a provisional liquidator or administrator in respect of that or another Relevant Person, or that or another Relevant Person ceasing or suspending business operations or payments to creditors, save that this paragraph does not apply to a fully solvent winding up of a Relevant Person other than a Borrower or the Corporate Guarantor which is, or is to be, effected for the purposes of an amalgamation or reconstruction previously approved by the Majority Lenders and effected not later than 3 months after the commencement of the winding up; or
|
(viii) |
an administration notice is given or filed, an application or petition to a court is made or presented or any other step is taken by a creditor of a Relevant Person (other than a holder of Security Interests which together relate to all or substantially all of the assets of a Relevant Person) for the winding up of a Relevant Person or the appointment of a provisional liquidator or administrator in respect of a Relevant Person in any Pertinent Jurisdiction, unless the proposed winding up, appointment of a provisional liquidator or administration is being contested in good faith, on substantial grounds and not with a view to some other insolvency law procedure being implemented instead and either (aa) the application or petition is dismissed or withdrawn within 30 days of being made or presented, or (bb) within 30 days of the administration notice being given or filed, or the other relevant steps being taken, other action is taken which will ensure that there will be no administration and (in both cases (aa) or (bb)) the Relevant Person will continue to carry on business in the ordinary way and without being the subject of any actual, interim or pending insolvency law procedure; or
|
(ix) |
a Relevant Person or its directors take any steps (whether by making or presenting an application or petition to a court, or submitting or presenting a document setting out a proposal or proposed terms, or otherwise) with a view to obtaining, in relation to that or another Relevant Person, any form of moratorium, suspension or deferral of payments, reorganisation of debt (or certain debt) or arrangement with all or a substantial proportion (by number or value) of creditors or of any class of them or any such moratorium, suspension or deferral of payments, reorganisation or arrangement is effected by court order, by the filing of documents with a court, by means of a contract or in any other way at all; or
|
(x) |
any meeting of the members or directors, or of any committee of the board or senior management, of a Relevant Person is held or summoned for the purpose of considering a resolution or proposal to authorise or take any action of a type described in paragraphs (iv) to (ix) or a step preparatory to such action, or (with or without such a meeting) the members, directors or such a committee resolve or agree that such an action or step should be taken or should be taken if certain conditions materialise or fail to materialise; or
|
(xi) |
in a country other than England, any event occurs, any proceedings are opened or commenced or any step is taken which, in the opinion of the Majority Lenders is similar to any of the foregoing; or
|
(h) |
any Borrower ceases or suspends carrying on its business or a part of its business which, in the opinion of the Majority Lenders, is material in the context of this Agreement; or
|
(i) |
it becomes unlawful in any Pertinent Jurisdiction or impossible:
|
(i) |
for any Borrower, the Corporate Guarantor or any other Security Party to discharge any liability under a Finance Document or to comply with any other obligation which the Majority Lenders consider material under a Finance Document; or
|
(ii) |
for the Agent, the Security Trustee, the Lenders or the Swap Bank to exercise or enforce any right under, or to enforce any Security Interest created by, a Finance Document; or
|
(j) |
any official consent (including, without limitation, consents required pursuant to the relevant entity's constitutional documents of those required by law) necessary to enable any Borrower to own, operate or charter the Ship owned by it or to enable any Borrower or any Security Party to comply with any provision which the Majority Lenders consider material of a Finance Document is not granted, expires without being renewed, is revoked or becomes liable to revocation or any condition of such a consent is not fulfilled; or
|
(k) |
any provision which the Majority Lenders consider material of a Finance Document proves to have been or becomes invalid or unenforceable, or a Security Interest created by a Finance Document proves to have been or becomes invalid or unenforceable or such a Security Interest proves to have ranked after, or loses its priority to, another Security Interest or any other third party claim or interest; or
|
(l) |
the security constituted by a Finance Document is in any way imperilled or in jeopardy; or
|
(m) |
without the prior written consent of the Lenders, the shares of the Corporate Guarantor cease to be listed on the New York Stock Exchange; or
|
(n) |
an Event of Default (as defined in section 14 of the Master Agreement) occurs; or
|
(o) |
the Master Agreement is terminated, cancelled, suspended, rescinded or revoked or otherwise ceases to remain in full force and effect for any reason except with the consent of the Agent, acting with the authorisation of the Majority Lenders; or
|
(p) |
any other event occurs or any other circumstances arise or develop including, without limitation:
|
(i) |
a change in the financial position, state of affairs or prospects of any Borrower and/or any Security Party and/or any member of the Group; or
|
(ii) |
any accident or any Environmental Incident or other event involving any Ship or another vessel owned, chartered or operated by a Relevant Person, which may have a Material Adverse Effect.
|
19.2 |
Actions following an Event of Default
|
(a) |
the Agent may, and if so instructed by the Majority Lenders, the Agent shall:
|
(i) |
serve on the Borrowers a notice stating that all or part of the Commitments and of the other obligations of each Lender to the Borrowers under this Agreement are cancelled; and/or
|
(ii) |
serve on the Borrowers a notice stating that all or part of the Loan together with accrued interest and all other amounts accrued or owing under this Agreement are immediately due and payable or are due and payable on demand; and/or
|
(iii) |
take any other action which, as a result of the Event of Default or any notice served under paragraph (i) or (ii), the Agent and/or the Lenders are entitled to take under any Finance Document or any applicable law; and/or
|
(b) |
the Security Trustee may, and if so instructed by the Agent, acting with the authorisation of the Majority Lenders, the Security Trustee shall take any action which, as a result of the Event of Default or any notice served under paragraph (a) (i) or (ii), the Security Trustee, the Agent, the Arranger and/or the Lenders and/or the Swap Bank are entitled to take under any Finance Document or any applicable law.
|
19.3 |
Termination of Commitments
|
19.4 |
Acceleration of Loan
|
19.5 |
Multiple notices; action without notice
|
19.6 |
Notification of Creditor Parties and Security Parties
|
19.7 |
Creditor Party's rights unimpaired
|
19.8 |
Exclusion of Creditor Party liability
|
(a) |
for any loss caused by an exercise of rights under, or enforcement of a Security Interest created by, a Finance Document or by any failure or delay to exercise such a right or to enforce such a Security Interest; or
|
(b) |
as mortgagee in possession or otherwise, for any income or principal amount which might have been produced by or realised from any asset comprised in such a Security Interest or for any reduction (however caused) in the value of such an asset, except that this does not exempt a Creditor Party or a receiver or manager from liability for losses shown to have been directly and mainly caused by the dishonesty or the wilful misconduct of such Creditor Party's own officers and employees or (as the case may be) such receiver's or manager's own partners or employees.
|
19.9 |
Relevant Persons
|
19.10 |
Interpretation
|
19.11 |
Position of Swap Bank
|
20 |
FEES AND EXPENSES
|
20.1 |
Arrangement and commitment fees
|
(a) |
on the Drawdown Date, a non-refundable arrangement fee of equal to $64,387.50; and
|
(b) |
a non-refundable commitment fee at the rate of 1.2 per cent. per annum on the undrawn or un-cancelled amount of the Total Commitments, during the period from (and including) the date of this Agreement up to the earlier of (i) the Drawdown Date and (ii) the last day of the Availability Period, such commitment fee to be payable quarterly in arrears during such period and on the last day thereof.
|
20.2 |
Costs of negotiation, preparation etc.
|
20.3 |
Costs of variations, amendments, enforcement etc.
|
(a) |
any amendment or supplement to a Finance Document, or any proposal for such an amendment to be made;
|
(b) |
any consent or waiver by the Lenders, the Swap Bank, the Majority Lenders or the Creditor Party concerned under or in connection with a Finance Document, or any request for such a consent or waiver;
|
(c) |
the valuation of any security provided or offered under Clause 15 or any other matter relating to such security;
|
(d) |
where the Security Trustee, in its absolute opinion, considers that there has been a material change to the insurances in respect of a Ship, the review of the insurances of that Ship pursuant to Clause 13.17; and
|
(e) |
any step taken by the Creditor Party concerned with a view to the protection, exercise or enforcement of any right or Security Interest created by a Finance Document or for any similar purpose (including, without limitation, a request for the preparation of any insurance opinion prepared by an insurance expert acceptable to the Agent, which, in the opinion of the Agent, opines on the matters requested by the Agent in a satisfactory manner).
|
20.4 |
Extraordinary management time
|
20.5 |
Documentary taxes
|
20.6 |
Certification of amounts
|
21 |
INDEMNITIES
|
21.1 |
Indemnities regarding borrowing and repayment of Loan
|
(a) |
the Loan not being borrowed on the date specified in the Drawdown Notice for any reason other than a default by the Lender claiming the indemnity;
|
(b) |
the receipt or recovery of all or any part of the Loan or an overdue sum otherwise than on the last day of an Interest Period or other relevant period;
|
(c) |
any failure (for whatever reason) by the Borrowers to make payment of any amount due under a Finance Document on the due date or, if so payable, on demand (after giving credit for any default interest paid by the Borrowers on the amount concerned under Clause 7); and
|
(d) |
the occurrence and/or continuance of an Event of Default or a Potential Event of Default and/or the acceleration of repayment of the Loan under Clause 19,
|
21.2 |
Breakage costs
|
(a) |
in liquidating or employing deposits from third parties acquired or arranged to fund or maintain all or any part of its Contribution and/or any overdue amount (or an aggregate amount which includes its Contribution or any overdue amount); and
|
(b) |
in terminating, or otherwise in connection with, any interest and/or currency swap or any other transaction entered into (whether with another legal entity or with another office or department of the Lender concerned) to hedge any exposure arising under this Agreement or that part which the Lender concerned determines is fairly attributable to this Agreement of the amount of the liabilities, expenses or losses (including losses of prospective profits) incurred by it in terminating, or otherwise in connection with, a number of transactions of which this Agreement is one.
|
21.3 |
Miscellaneous indemnities
|
(a) |
any action taken, or omitted or neglected to be taken, under or in connection with any Finance Document by the Agent, the Security Trustee, the Arranger or any other Creditor Party or by any receiver appointed under a Finance Document; and
|
(b) |
any other Pertinent Matter, other than claims, expenses, liabilities and losses which are shown to have been directly and mainly caused by the dishonesty or wilful misconduct of the officers or employees of the Creditor Party concerned.
|
21.4 |
Environmental Indemnity
|
21.5 |
Currency indemnity
|
(a) |
making or lodging any claim or proof against any Borrower or any Security Party, whether in its liquidation, any arrangement involving it or otherwise; or
|
(b) |
obtaining an order or judgment from any court or other tribunal; or
|
(c) |
enforcing any such order or judgment, the Borrowers shall indemnify the Creditor Party concerned against the loss arising when the amount of the payment actually received by that Creditor Party is converted at the available rate of exchange into the Contractual Currency.
|
21.6 |
Application to Master Agreement
|
21.7 |
Certification of amounts
|
21.8 |
Sums deemed due to a Lender
|
21.9 |
Notice of prepayment
|
21.10 |
Prepayment
|
22 |
NO SET-OFF OR TAX DEDUCTION
|
22.1 |
No deductions
|
(a) |
without any form of set off, cross-claim or condition; and
|
(b) |
free and clear of any tax deduction except a tax deduction which a Borrower is required by law to make.
|
22.2 |
Grossing-up for taxes
|
(a) |
that Borrower shall notify the Agent as soon as it becomes aware of the requirement;
|
(b) |
that Borrower shall pay the tax deducted to the appropriate taxation authority promptly, and in any event before any fine or penalty arises; and
|
(c) |
the amount due in respect of the payment shall be increased by the amount necessary to ensure that each Creditor Party receives and retains (free from any liability relating to the tax deduction) a net amount which, after the tax deduction, is equal to the full amount which it would otherwise have received.
|
22.3 |
Evidence of payment of taxes
|
22.4 |
Exclusion of tax on overall net income
|
22.5 |
Application to Master Agreement
|
22.6 |
Notice of prepayment
|
22.7 |
Prepayment
|
22.8 |
FATCA
|
(a) |
FATCA Information
|
(i) |
Subject to paragraph (iii) below, each party to a Finance Document shall, within 10 Business Days of a reasonable request by another party to the Finance Documents:
|
(A) |
confirm to that other party whether it is a FATCA Exempt Party or is not a FATCA Exempt Party; and
|
(B) |
supply to the requesting party such forms (including IRS Form W-8 or Form W-9 or any successor or substitute form, as applicable), documentation and other information relating to its status under FATCA (including its applicable "passthru percentage" or other information required under the US Treasury regulations or other official guidance including intergovernmental agreements) as the requesting party reasonably requests for the purposes of such requesting party's compliance with FATCA;
|
(ii) |
If a party to any Finance Document confirms to another party pursuant to Clause 22.8(a)(i) above that it is a FATCA Exempt Party or provides an IRS Form W-8 or W-9 showing that it is a FATCA Exempt Party and it subsequently becomes aware that it is not, or has ceased to be a FATCA Exempt Party, or that the IRS Form has ceased to be valid, that party shall notify that other party reasonably promptly;
|
(iii) |
Sub-clause (i) above shall not oblige any Creditor Party to do anything which would or might in its reasonable opinion constitute a breach of any law or regulation, any policy of that party, any fiduciary duty or any duty of confidentiality, or to disclose any confidential information (including, without limitation, its tax returns and calculations); provided, however, that information required (or equivalent to the information so required) by IRS Forms W-8 or W-9 (or any successor forms) shall not be treated as confidential information of such party for purposes of this sub-clause (iii);
|
(iv) |
If a party to any Finance Document fails to confirm its status or to supply forms, documentation or other information requested in accordance with sub-clause (i) above (including, for the avoidance of doubt, where sub-clause (iii) above applies), then:
|
(A) |
if that party failed to confirm whether it is (and/or remains) a FATCA Exempt Party then such party shall be treated for the purposes of the Finance Documents as if it is not a FATCA Exempt Party; and
|
(B) |
if that party failed to confirm its applicable passthru percentage then such party shall be treated for the purposes of the Finance Documents (and payments made thereunder) as if its applicable passthru percentage is 100 per cent.,
|
(b) |
FATCA Withholding
|
(i) |
Each party to any Finance Document may make any FATCA Deduction it is required to make by FATCA, and any payment required in connection with that FATCA Deduction, and no party shall be required to increase any payment in respect of which it makes such a FATCA Deduction or otherwise compensate the recipient of the payment for that FATCA Deduction.
|
(ii) |
Each party to any Finance Document shall promptly, upon becoming aware that it must make a FATCA Deduction (or that there is any change in the rate or the basis of such FATCA Deduction) notify the party to whom it is making the payment and, in addition, shall notify the Borrowers, the Agent and the other Creditor Parties.
|
23 |
ILLEGALITY, ETC.
|
23.1 |
Illegality
|
(a) |
unlawful or prohibited as a result of the introduction of a new law, an amendment to an existing law or a change in the manner in which an existing law is or will be interpreted or applied; or
|
(b) |
contrary to, or inconsistent with, any regulation,
|
23.2 |
Notification of illegality
|
23.3 |
Prepayment; termination of Commitment
|
23.4 |
Mitigation
|
(a) |
have an adverse effect on its business, operations or financial condition; or
|
(b) |
involve it in any activity which is unlawful or prohibited or any activity that is contrary to, or inconsistent with, any regulation; or
|
(c) |
involve it in any expense (unless indemnified to its satisfaction) or tax disadvantage.
|
24 |
INCREASED COSTS
|
24.1 |
Increased costs
|
(a) |
the introduction or alteration after the date of this Agreement of a law or an alteration after the date of this Agreement in the manner in which a law is interpreted or applied (disregarding any effect which relates to the application to payments under this Agreement of a tax on that Lender's overall net income); or
|
(b) |
complying with any regulation (including the "International Convergence of Capital Measurement and Capital Standards, a Revised Framework" published by the Basel Committee on Banking Supervision in June 2004, in the form existing on the date of this Agreement (
"Basel II"
)
and any other regulation which relates to capital adequacy or liquidity controls or which affects the manner in which the Notifying Lender allocates capital resources to its obligations under this Agreement) which is introduced, or altered, or the interpretation or application of which is altered, after the date of this Agreement; or
|
(c) |
the introduction, implementation, application, administration or compliance with Basel III, CRD IV or CRR or any law or regulation which implements or applies Basel
III,
CRD IV or CRR (regardless of the date on which it is enacted, adopted or issued and regardless of whether any such implementation, application or compliance is by a government, regulator, the Creditor Party or any of its Affiliates) after the date of this Agreement, the Notifying Lender (or its Holding Company) has incurred or will incur an
"increased cost".
|
24.2 |
Meaning of "increased costs"
|
(a) |
an additional or increased cost incurred as a result of, or in connection with, the Notifying Lender having entered into, or being a party to, this Agreement or a Transfer Certificate, of funding or maintaining its Commitment or Contribution or performing its obligations under this Agreement, or of having outstanding all or any part of its Contribution or other unpaid sums;
|
(b) |
a reduction in the amount of any payment to the Notifying Lender under this Agreement or in the effective return which such a payment represents to the Notifying Lender or on its capital;
|
(c) |
an additional or increased cost of funding all or maintaining all or any of the advances comprised in a class of advances formed by or including the Notifying Lender's Contribution or (as the case may require) the proportion of that cost attributable to the Contribution; or
|
(d) |
a liability to make a payment, or a return foregone, which is calculated by reference to any amounts received or receivable by the Notifying Lender under this Agreement,
|
24.3 |
Notification to Borrowers of claim for increased costs
|
24.4 |
Payment of increased costs
|
24.5 |
Notice of prepayment
|
24.6 |
Prepayment; termination of Commitment
|
(a) |
on the date on which the Agent serves that notice, the Commitment of the Notifying Lender shall be cancelled; and
|
(b) |
on the date specified in its notice of intended prepayment, the Borrowers shall prepay (without premium or penalty) the Notifying Lender's Contribution, together with accrued interest thereon at the applicable rate plus the Margin.
|
24.7 |
Application of prepayment
|
25 |
SET-OFF
|
25.1 |
Application of credit balances
|
(a) |
apply any balance (whether or not then due) which at any time stands to the credit of any account in the name of a Borrower at any office in any country of that Creditor Party in or towards satisfaction of any sum then due from that Borrower to that Creditor Party under any of the Finance Documents; and
|
(b) |
for that purpose:
|
(ii) |
convert or translate all or any part of a deposit or other credit balance into Dollars; and
|
(iii) |
enter into any other transaction or make any entry with regard to the credit balance which the Creditor Party concerned considers appropriate.
|
25.2 |
Existing rights unaffected
|
25.3 |
Sums deemed due to a Lender
|
25.4 |
No Security Interest
|
26 |
TRANSFERS AND CHANGES IN LENDING OFFICES
|
26.1 |
Transfer by Borrowers
|
26.2 |
Transfer by a Lender
|
(a) |
its rights in respect of all or part of its Contribution; or
|
(b) |
its obligations in respect of all or part of its Commitment; or
|
(c) |
a combination of (a) and (b),
|
(i) |
without the consent of the Borrowers:
|
(A) |
following the occurrence of an Event of Default which is continuing; and/or
|
(B) |
if such transfer is to another Lender or an Affiliate of a Lender; and
|
(ii) |
in all other circumstances with the consent of the Borrowers (such consent not to be unreasonably withheld or delayed) and the Borrowers will be deemed to have given its consent 5 Business Days following the request of the Transferor Lender unless the consent is expressly refused by the Borrowers within that time.
|
26.3 |
Transfer Certificate, delivery and notification
|
(a) |
sign the Transfer Certificate on behalf of itself, the Borrowers, the Security Parties, the Security Trustee, each of the other Lenders and the Swap Bank;
|
(b) |
on behalf of the Transferee Lender, send to each Borrower and each Security Party letters or faxes notifying them of the Transfer Certificate and attaching a copy of it; and
|
(c) |
send to the Transferee Lender copies of the letters or faxes sent under paragraph (b) above,
|
26.4 |
Effective Date of Transfer Certificate
|
26.5 |
No transfer without Transfer Certificate
|
26.6 |
Lender re-organisation; waiver of Transfer Certificate
|
26.7 |
Effect of Transfer Certificate
|
(a) |
to the extent specified in the Transfer Certificate, all rights and interests (present, future or contingent) which the Transferor Lender has under or by virtue of the Finance Documents (other than the Master Agreement) are assigned to the Transferee Lender absolutely, free of any defects in the Transferor Lender's title and of any rights or equities which any Borrower or any Security Party had against the Transferor Lender;
|
(b) |
the Transferor Lender's Commitment is discharged to the extent specified in the Transfer Certificate;
|
(c) |
the Transferee Lender becomes a Lender with the Contribution previously held by the Transferor Lender and a Commitment of an amount specified in the Transfer Certificate;
|
(d) |
the Transferee Lender becomes bound by all the provisions of the Finance Documents (other than the Master Agreement) which are applicable to the Lenders generally, including those
|
(e) |
any part of the Loan which the Transferee Lender advances after the Transfer Certificate's effective date ranks in point of priority and security in the same way as it would have ranked had it been advanced by the transferor, assuming that any defects in the transferor's title and any rights or equities of any Borrower or any Security Party against the Transferor Lender had not existed;
|
(f) |
the Transferee Lender becomes entitled to all the rights under the Finance Documents (other than the Master Agreement) which are applicable to the Lenders generally, including but not limited to those relating to the Majority Lenders and those under Clause 5.7 and Clause 20, and to the extent that the Transferee Lender becomes entitled to such rights, the Transferor Lender ceases to be entitled to them; and
|
(g) |
in respect of any breach of a warranty, undertaking, condition or other provision of a Finance Document or any misrepresentation made in or in connection with a Finance Document, the Transferee Lender shall be entitled to recover damages by reference to the loss incurred by it as a result of the breach or misrepresentation, irrespective of whether the original Lender would have incurred a loss of that kind or amount.
|
26.8 |
Maintenance of register of Lenders
|
26.9 |
Reliance on register of Lenders
|
26.10 |
Authorisation of Agent to sign Transfer Certificates
|
26.11 |
Registration fee
|
26.12 |
Sub-participation; securitisation; subrogation assignment
|
(a) |
A Lender may sub-participate or include in a securitisation or similar transaction all or any part of its rights and/or obligations under or in connection with the Finance Documents without the consent of, or any notice to, any Borrower, any Security Party, the Agent or the
|
(b) |
The Borrower shall, and shall procure that each Security Party shall, do everything desirable or necessary to assist a Lender to achieve a successful (in the opinion of that Lender) securitisation (or similar transaction).
|
26.13 |
Disclosure of information
|
(a) |
a potential transferee lender, sub-participant, Affiliate, any other assignee or transferee or any other person who may propose entering into a contractual relation with that Lender in relation to this Agreement; and/or
|
(b) |
any direct or indirect Subsidiary, any direct or indirect Holding Company, any Affiliate or any other company in its group; and/or
|
(c) |
any authorities (including, without limitation, any private, public or internationally recognised authorities) or any party to any Finance Document or any professional adviser to that Lender; and/or
|
(d) |
a rating agency or their professional advisors; and/or
|
(e) |
any other person regarding the funding, refinancing, transfer, assignment, sale, sub-participation, operational arrangement or other transaction in relation thereto including without limitation any enforcement, preservation, assignment, transfer, sale or sub-participation of that Lender's rights and obligations, and including, without limitation, (x) for purposes in connection with (1) any enforcement or (2) assignment or transfer of that Lender's rights or obligations under any Finance Document or (y) to the extent desirable or necessary in connection with or in contemplation of a securitisation (or similar transaction).
|
26.14 |
Change of lending office
|
(a) |
the date on which the Agent receives the notice; and
|
(b) |
the date, if any, specified in the notice as the date on which the change will come into effect.
|
26.15 |
Notification
|
26.16 |
Replacement of the Reference Bank
|
26.17 |
Security over Lenders' rights
|
(a) |
any charge, assignment or other Security Interest to secure obligations to a federal reserve or central bank; and
|
(b) |
in the case of any Lender which is a fund, any charge, assignment or other Security Interest granted to any holders (or trustee or representatives of holders) of obligations owed, or securities issued, by that Lender as security for those obligations or securities,
|
(i) |
release a Lender from any of its obligations under the Finance Documents or substitute the beneficiary of the relevant charge, assignment or Security Interest for that Lender as a party to any of the Finance Documents; or
|
(ii) |
require any payments to be made by any Borrower or any Security Party or grant to any person any more extensive rights than those required to be made or granted to the relevant Lender under the Finance Documents.
|
27 |
VARIATIONS AND WAIVERS
|
27.1 |
Variations, waivers etc. by Majority Lenders
|
27.2 |
Variations, waivers etc. requiring agreement of all Lenders.
|
(a) |
a reduction in the Margin;
|
(b) |
a postponement to the date for, or a reduction in the amount of, any payment of principal, interest, fees or other sum payable under this Agreement;
|
(c) |
an increase in any Lender's Commitment;
|
(d) |
a change to the definition of
"Majority Lenders"
;
|
(e) |
a change to Clause 3 or this Clause 27;
|
(f) |
any release of, or material variation to, a Security Interest, guarantee, indemnity or subordination arrangement set out in a Finance Document; and
|
(g) |
any other change or matter as regards which this Agreement or another Finance Document expressly provides that each Lender's consent is required.
|
27.3 |
Exclusion of other or implied variations
|
(a) |
a provision of this Agreement or another Finance Document; or
|
(b) |
an Event of Default; or
|
(c) |
a breach by a Borrower or a Security Party of an obligation under a Finance Document or the general law; or
|
(d) |
any right or remedy conferred by any Finance Document or by the general law, and there shall not be implied into any Finance Document any term or condition requiring any such provision to be enforced, or such right or remedy to be exercised, within a certain or reasonable time.
|
28 |
NOTICES
|
28.1 |
General
|
28.2 |
Addresses for communications
|
(a) | to the Borrowers: |
c/o Approved Manager
16 Pendelis Street 175 64 Paleo Faliro Athens Greece Fax No: +30 210 9470101 |
(b) | to a Lender: | At the address below its name in Schedule 1 or (as the case may require) in the relevant Transfer Certificate. |
(c) |
to the Agent, Arranger
|
and Security Trustee: |
ABN AMRO Bank N.V.
93 Coolsingel 3012 AE Rotterdam The Netherlands |
(d) | to the Swap Bank: |
ABN AMRO Bank N.V.
c/o Markets Documentation Unit Gustav Mahlerlaan 10 NL-1082PP Amsterdam The Netherlands mdu@nl.abnamro.com Fax No: +31 10 459 0538 |
28.3 |
Effective date of notices
|
(a) |
a notice which is delivered personally or posted shall be deemed to be served, and shall take effect, at the time when it is delivered; and
|
(b) |
a notice which is sent by fax shall be deemed to be served, and shall take effect, 2 hours after its transmission is completed.
|
28.4 |
Service outside business hours
|
(a) |
on a day which is not a business day in the place of receipt; or
|
(b) |
on such a business day, but after 5 p.m. local time, the notice shall (subject to Clause 28.5) be deemed to be served, and shall take effect, at 9 a.m. on the next day which is such a business day.
|
28.5 |
Illegible notices
|
28.6 |
Valid notices
|
(a) |
the failure to serve it in accordance with the requirements of this Agreement or other Finance Document, as the case may be, has not caused any party to suffer any significant loss or prejudice; or
|
(b) |
in the case of incorrect and/or incomplete contents, it should have been reasonably clear to the party on which the notice was served what the correct or missing particulars should have been.
|
28.7 |
Electronic communication
|
(a) |
agree that, unless and until notified to the contrary, this is to be an accepted form of communication;
|
(b) |
notify each other in writing of their electronic mail address and/or any other information required to enable the sending and receipt of information by that means; and
|
(c) |
notify each other of any change to their respective addresses or any other such information supplied to them.
|
28.8 |
English language
|
28.9 |
Meaning of "notice"
|
29 |
JOINT AND SEVERAL LIABILITY
|
29.1 |
General
|
29.2 |
No impairment of Borrower's obligations
|
(a) |
this Agreement being or later becoming void, unenforceable or illegal as regards any other Borrower;
|
(b) |
any Lender, the Swap Bank or the Security Trustee entering into any rescheduling, refinancing or other arrangement of any kind with any other Borrower;
|
(c) |
any Lender, the Swap Bank or the Security Trustee releasing any other Borrower or any Security Interest created by a Finance Document; or
|
(d) |
any combination of the foregoing.
|
29.3 |
Principal debtors
|
29.4 |
Subordination
|
(a) |
claim any amount which may be due to it from any other Borrower whether in respect of a payment made, or matter arising out of, this Agreement or any Finance Document, or any matter unconnected with this Agreement or any Finance Document; or
|
(b) |
take or enforce any form of security from any other Borrower for such an amount, or in any other way seek to have recourse in respect of such an amount against any asset of any other Borrower; or
|
(c) |
set off such an amount against any sum due from it to any other Borrower; or
|
(d) |
prove or claim for such an amount in any liquidation, administration, arrangement or similar procedure involving any other Borrower or other Security Party; or
|
(e) |
exercise or assert any combination of the foregoing.
|
29.5 |
Borrower's required action
|
30 |
SUPPLEMENTAL
|
30.1 |
Rights cumulative, non-exclusive
|
(a) |
cumulative;
|
(b) |
may be exercised as often as appears expedient; and
|
(c) |
shall not, unless a Finance Document explicitly and specifically states so, be taken to exclude or limit any right or remedy conferred by any law.
|
30.2 |
Severability of provisions
|
30.3 |
Counterparts
|
30.4 |
Third party rights
|
30.5 |
PATRIOT Act Notice
|
31 |
CONFIDENTIALITY
|
31.1 |
Confidential Information
|
31.2 |
Disclosure of Confidential Information
|
(a) |
to any of its Affiliates and Related Funds and any of their officers, directors, employees, professional advisers, auditors, partners and Representatives such Confidential Information as the Creditor Parties shall consider appropriate if any person to whom the Confidential Information is to be given pursuant to this paragraph (a) is informed in writing of its confidential nature and that some or all of such Confidential Information may be price-sensitive information except that there shall be no such requirement to so inform if the recipient is subject to professional obligations to maintain the confidentiality of the information or is otherwise bound by requirements of confidentiality in relation to the Confidential Information;
|
(b) |
to any person (if that person to whom the Confidential Information is to be given is informed in writing of its confidential nature and undertakes in writing not to disclose such Confidential Information to any third party and/or make use of it in case the dealings contemplated below are not concluded):
|
(i) |
to (or through) whom it assigns or transfers (or may potentially assign or transfer) all or any of its rights and/or obligations under one or more Finance Documents and to any of that person's Affiliates, Related Funds, Representatives and professional advisers;
|
(ii) |
with (or through) whom it enters into (or may potentially enter into), whether directly or indirectly, any sub-participation in relation to, or any other transaction under which payments are to be made or may be made by reference to, one or more Finance Documents and/or any Borrower and/or any Security Party and to any of that person's Affiliates, Related Funds, Representatives and professional advisers;
|
(iii) |
appointed by the Creditor Parties or by a person to whom paragraphs (i) or (ii) applies to receive communications, notices, information or documents delivered pursuant to the Finance Documents on its behalf;
|
(iv) |
who invests in or otherwise finances (or may potentially invest in or otherwise finance), directly or indirectly, any transaction referred to in paragraphs (i) or (ii);
|
(v) |
to whom information is required or requested to be disclosed by any court of competent jurisdiction or any governmental, banking, taxation or other regulatory
|
(vi) |
to whom or for whose benefit a Creditor Parties charges, assigns or otherwise creates security (or may do so) pursuant to Clause 26.17;
|
(vii) |
to whom information is required to be disclosed in connection with, and for the purposes of, any litigation, arbitration, administrative or other investigations, proceedings or disputes;
|
(viii) |
to whom information is required to be disclosed in connection with, and for the purposes of, any litigation, arbitration, administrative or other investigations, proceedings or disputes;
|
(ix) |
to whom information is required to be disclosed in connection with, and for the purposes of, any insurance to be effected by a Creditor Party in relation to or in connection with any Finance Document;
|
(x) |
who is a party to this Agreement; or
|
(xi) |
with the consent of the Borrowers,
|
(c) |
to any person appointed by a Creditor Party by a person to whom paragraphs (b)(i) or (b)(ii) of Clause 31.2 applies to provide administration or settlement services in respect of one or more of the Finance Documents including without limitation, in relation to the trading of participations in respect of the Finance Documents, such Confidential Information as may be required to be disclosed to enable such service provider to provide any of the services referred to in this paragraph (c) provided always that such person will undertake in writing not to disclose such Confidential Information to any third party;
|
(d) |
to any rating agency (including its profession advisers) such Confidential Information as may be required to be disclosed to enable such rating agency to carry out its normal rating activities in relation to the Finance Documents, the Borrowers and/or the Security Parties provided always that such rating agency will undertake in writing not to disclose such Confidential Information to any third party.
|
31.3 |
Entire agreement
|
31.4 |
Inside Information
|
31.5 |
Notification of disclosure
|
(a) |
of the circumstances of any disclosure of Confidential Information made pursuant to paragraph (b)(v) of Clause 31.2 except where such disclosure is made to any of the persons referred to in that paragraph during the ordinary course of its supervisory or regulatory function; and
|
(b) |
upon becoming aware that Confidential Information has been disclosed in breach of this Clause 31.
|
31.6 |
Continuing obligations
|
(a) |
the date on which all amounts payable by the Borrowers and the Security Parties under or in connection with the Finance Documents have been paid in full and all obligations of the Creditor Parties have been cancelled or otherwise cease to be available; and
|
(b) |
the date on which a Creditor Party otherwise ceases to be a party to this Agreement.
|
32 |
BAIL-IN
|
32.1 |
Contractual recognition of bail-in
|
(a) |
any Bail-In Action in relation to any such liability, including (without limitation):
|
(i) |
a reduction, in full or in part, in the principal amount, or outstanding amount due (including any accrued but unpaid interest) in respect of any such liability;
|
(ii) |
a conversion of all, or part of, any such liability into shares or other instruments of ownership that may be issued to, or conferred on, it; and
|
(iii) |
a cancellation of any such liability; and
|
(b) |
a variation of any term of any Finance Document to the extent necessary to give effect to any Bail-In Action in relation to any such liability.",
|
33 |
LAW AND JURISDICTION
|
33.1 |
English law
|
33.2 |
Exclusive English jurisdiction
|
33.3 |
Choice of forum for the exclusive benefit of Creditor Parties
|
(a) |
to commence proceedings in relation to any Dispute in the courts of any country other than England and which have or claim jurisdiction to that Dispute; and
|
(b) |
to commence such proceedings in the courts of any such country or countries concurrently with or in addition to proceedings in England or without commencing proceedings in England.
|
33.4 |
Process agent
|
33.5 |
Creditor Party rights unaffected
|
33.6 |
Meaning of "proceedings" and "Dispute"
|
Lender
|
Lending Office
|
Commitment
(US Dollars) |
ABN AMRO BANK N.V.
|
c/o Loans Administration –
Transportation Clients
93 Coolsingel
3012 AE Rotterdam
The Netherlands
|
25,755,000
|
To: |
ABN AMR° BANK N.V.
93 Coolsingel 3012 AE Rotterdam The Netherlands |
1 |
We refer to the loan agreement (the
"Loan Agreement"
)
dated [●] March 2016 and made between ourselves, as joint and several Borrowers, the Lenders referred to therein, and yourselves as Agent, Arranger, Security Trustee and Swap Bank in connection with a term loan facility of up to US$25,755,000. Terms defined in the Loan Agreement have their defined meanings when used in this Drawdown Notice.
|
2 |
We request to borrow as follows:
|
(a) |
Amount of Loan: US$25,755,000;
|
(b) |
Drawdown Date: [●] 2016;
|
(c) |
Duration of the first Interest Period shall be [●] months; and
|
(d) |
Payment instructions: account in our name and numbered [●] with [●] of [●].
|
3 |
We represent and warrant that:
|
(a) |
the representations and warranties in Clause 10 of the Loan Agreement would remain true and not misleading if repeated on the date of this notice with reference to the circumstances now existing; and
|
(b) |
no Event of Default or Potential Event of Default has occurred or will result from the borrowing of the Loan.
|
4 |
This notice cannot be revoked without the prior consent of the Majority Lenders.
|
5 |
[We authorise you to deduct the arrangement fee, being in the amount of $[●], and the accrued commitment fee, being in the amount of $[●], each referred to in Clause 20.1 of the Loan Agreement, from the Loan.]
|
1 |
A duly executed original of this Agreement and each Finance Document (and of each document required to be delivered by each Finance Document) other than those referred to in Part B.
|
2 |
Copies of the certificate of incorporation and constitutional documents of each Borrower, the Corporate Guarantor and any other Security Party.
|
3 |
Copies of resolutions of the shareholders and directors of each Borrower and each Security Party (other than the Corporate Guarantor) authorising the execution of each of the Finance Documents to which that Borrower or that Security Party is a party and, in the case of a Borrower, authorising named officers to give the Drawdown Notice and other notices under this Agreement.
|
4 |
Copies of resolutions of the executive committee of the Corporate Guarantor authorising the execution of each of the Finance Documents to which it is a party.
|
5 |
The original of any power of attorney under which any Finance Document is executed on behalf of a Borrower, the Corporate Guarantor or any other Security Party.
|
6 |
Copies of all consents which any Borrower, the Corporate Guarantor or any Security Party requires to enter into, or make any payment under, any Finance Document.
|
7 |
The originals of any mandates or other documents required by the Agent in connection with the opening or operation of the Accounts.
|
8 |
Such documents and other evidence in such form as is requested by the Agent in order for the Lenders to comply with all necessary "know your customer" or "client acceptance" or other similar identification procedures (including, but not limited to, specimen signatures of all the directors and other officers of each Borrower and each Security Party) in relation to the transactions contemplated in the Finance Documents.
|
9 |
Documentary evidence that the agent for service of process named in Clause 31 has accepted its appointment.
|
10 |
Favourable legal opinions from lawyers appointed by the Agent on such matters concerning the laws of Marshall Islands and such other relevant jurisdictions as the Agent may require.
|
11 |
If the Agent so requires, in respect of any of the documents referred to above, a certified English translation prepared by a translator approved by the Agent.
|
(a) |
"Relevant Borrower"
means the Borrower which is the owner of the Relevant Ship; and
|
(b) |
"Relevant Ship"
means the Ship which is to be financed by using the proceeds of the Loan being drawn on the Drawdown Date.
|
1 |
A duly executed original of the Mortgage and the General Assignment relating to the Relevant Ship (and of each document to be delivered under each of them).
|
2 |
Documentary evidence that:
|
(a) |
the Relevant Ship is definitively and permanently registered in the name of the Relevant Borrower under an Approved Flag;
|
(b) |
the Relevant Ship is in the absolute and unencumbered ownership of the Relevant Borrower save as contemplated by the Finance Documents;
|
(c) |
the Relevant Ship maintains the highest class with a classification society which is a member of IACS and acceptable to the Agent free of all overdue recommendations and conditions ;
|
(d) |
the Mortgage relating to the Relevant Ship has been duly registered or recorded against the Relevant Ship as a valid first preferred or, as the case may be, priority ship mortgage in accordance with the laws of the applicable Approved Flag State; and
|
(e) |
the Relevant Ship is insured in accordance with the provisions of this Agreement and all requirements therein in respect of insurances have been complied with.
|
3 |
Documents establishing that the Relevant Ship will, as from the Drawdown Date, be managed by the Approved Manager on terms acceptable to the Agent, together with:
|
(a) |
the Approved Manager's Undertaking in respect of the Relevant Ship duly signed by the Approved Manager; and
|
(b) |
copies of the Approved Manager's Document of Compliance and of the Relevant Ship's Safety Management Certificate (together with any other details of the applicable safety management system which the Agent requires), the ISSC and the IAPPC.
|
4 |
Evidence satisfactory to the Agent that each Borrower has opened and maintains its Earnings Account and the Excess Cash Account.
|
5 |
Favourable legal opinions from lawyers appointed by the Agent on such matters concerning the laws of Marshall Islands, the applicable Approved Flag State and such other relevant jurisdictions as the Agent may require.
|
6 |
At the cost of the Borrowers, a favourable opinion from an independent insurance consultant acceptable to the Agent on such matters relating to the insurances for the Relevant Ship as the Agent may require.
|
7 |
Evidence satisfactory to the Agent that the Minimum Liquidity Amount is standing to the credit of the Earnings Account in respect of the Relevant Ship pursuant to Clause 11.17.
|
8 |
If the Agent so requires, in respect of any of the documents referred to above, a certified English translation prepared by a translator approved by the Agent.
|
To: |
ABN AMRO Bank N.V. for itself and for and on behalf of the Borrower, [each Security Party], the Security Trustee, each Lender and the Swap Bank, as defined in the Loan Agreement referred to below.
|
1 |
This Certificate relates to a Loan Agreement (the
"Loan Agreement"
)
dated [●] March 2016 and made between (1) Kaben Shipping Company Inc. and Taroa Shipping Company Inc. as joint and several borrowers (the
"Borrowers"
)
,
(2) the banks and financial institutions named in Schedule 1 thereto as Lenders, (3) ABN AMRO Bank N.V. as Agent, (4) ABN AMRO Bank N.V. as Arranger, (5) ABN AMRO Bank N.V. as Security Trustee and (6) ABN AMRO Bank N.V. as Swap Bank for a loan facility of up to US$25,755,000.
|
2 |
In this Certificate, terms defined in the Loan Agreement shall, unless the contrary intention appears, have the same meanings when used in this Certificate and:
|
3 |
The effective date of this Certificate is [●],
Provided that
this Certificate shall not come into effect unless it is signed by the Agent on or before that date.
|
4 |
[The Transferor assigns to the Transferee absolutely all rights and interests (present, future or contingent) which the Transferor has as Lender under or by virtue of the Loan Agreement and every other Finance Document (other than the Master Agreement) in relation to [●] per cent. of its Contribution, which percentage represents $[●].]
|
5 |
[By virtue of this Certificate and Clause 26 of the Loan Agreement, the Transferor is discharged [entirely from its Commitment which amounts to $[●] [from [0] per cent. of its Commitment, which percentage represents $[●]] and the Transferee acquires a Commitment of $[●].]
|
6 |
The Transferee undertakes with the Transferor and each of the Relevant Parties that the Transferee will observe and perform all the obligations under the Finance Documents (other than the Master Agreement) which Clause 26 of the Loan Agreement provides will become binding on it upon this Certificate taking effect.
|
7 |
The Agent, at the request of the Transferee (which request is hereby made) accepts, for the Agent itself and for and on behalf of every other Relevant Party, this Certificate as a Transfer Certificate taking effect in accordance with Clause 26 of the Loan Agreement.
|
8 |
The Transferor:
|
(a) |
warrants to the Transferee and each Relevant Party that:
|
(i) |
the Transferor has full capacity to enter into this transaction and has taken all corporate action and obtained all consents which are required in connection with this transaction; and
|
(ii) |
this Certificate is valid and binding as regards the Transferor;
|
(b) |
warrants to the Transferee that the Transferor is absolutely entitled, free of encumbrances, to all the rights and interests covered by the assignment in paragraph 4 above; and
|
(c) |
undertakes with the Transferee that the Transferor will, at its own expense, execute any documents which the Transferee reasonably requests for perfecting in any relevant jurisdiction the Transferee's title under this Certificate or for a similar purpose.
|
9 |
The Transferee:
|
(a) |
confirms that it has received a copy of the Loan Agreement and each of the other Finance Documents;
|
(b) |
agrees that it will have no rights of recourse on any ground against either the Transferor, the Agent, the Arranger, the Security Trustee, any Lender or the Swap Bank in the event that:
|
(i) |
any of the Finance Documents prove to be invalid or ineffective;
|
(ii) |
any Borrower or any Security Party fails to observe or perform its obligations, or to discharge its liabilities, under any of the Finance Documents; and
|
(iii) |
it proves impossible to realise any asset covered by a Security Interest created by a Finance Document, or the proceeds of such assets are insufficient to discharge the liabilities of the Borrowers or any Security Party under any of the Finance Documents;
|
(c) |
agrees that it will have no rights of recourse on any ground against the Agent, the Arranger, the Security Trustee, any Lender or the Swap Bank in the event that this Certificate proves to be invalid or ineffective;
|
(d) |
warrants to the Transferor and each Relevant Party that:
|
(i) |
it has full capacity to enter into this transaction and has taken all corporate action and obtained all consents which it needs to take or obtain in connection with this transaction; and
|
(ii) |
this Certificate is valid and binding as regards the Transferee; and
|
(e) |
confirms the accuracy of the administrative details set out below regarding the Transferee.
|
10 |
The Transferor and the Transferee each undertake with the Agent, the Arranger and the Security Trustee severally, on demand, fully to indemnify the Agent and/or the Arranger and/or the Security Trustee in respect of any claim, proceeding, liability or expense (including all legal expenses) which they or any of them may incur in connection with this Certificate or any matter arising out of it, except such as are shown to have been mainly and directly caused by the gross and culpable negligence or dishonesty of the Agent's, the Arranger's or the Security Trustee's own officers or employees.
|
11 |
The Transferee shall repay to the Transferor on demand so much of any sum paid by the Transferor under paragraph 10 as exceeds one-half of the amount demanded by the Agent, the Arranger or the Security Trustee in respect of a claim, proceeding, liability or expense which was not reasonably foreseeable at the date of this Certificate; but nothing in this
|
[Name of Transferor]
|
[Name of Transferee]
|
By:
|
By:
|
Date:
|
Date:
|
Note: |
This Transfer Certificate alone may not be sufficient to transfer a proportionate share of the Transferor's interest in the security constituted by the Finance Documents in the Transferor's or Transferee's jurisdiction. It
is the responsibility of each Lender to ascertain whether any other documents are required for this purpose.
|
To: |
ABN AMRO Bank N.V.
93 Coolsingel 3012 AE Rotterdam The Netherlands as Agent Attention: Loans Administration |
2 |
the Master Agreement dated as of [●] 2016 made between ourselves and the Swap Bank; and
|
3 |
a Confirmation delivered pursuant to the said Master Agreement dated [●] and addressed by the Swap Bank to us.
|
for and on behalf of
|
||
KABEN SHIPPING COMPANY INC. and
|
||
TAROA SHIPPING COMPANY INC.
|
THE BORROWERS
|
||
SIGNED
by
|
)
|
|
Ioannis Zafirakis
|
)
|
/s/ Ioannis Zafirakis
|
for and on behalf of
|
)
|
|
KABEN SHIPPING COMPANY INC.
|
)
|
|
in the presence of:
|
)
|
|
/s/ Vassiliki Georgopoulos
|
||
SIGNED
by:
|
)
|
|
Ioannis Zafirakis
|
)
|
/s/ Ioannis Zafirakis
|
for and on behalf of
|
)
|
|
TAROA SHIPPING COMPANY INC.
|
)
|
|
in the presence of:
|
)
|
|
/s/ Vassiliki Georgopoulos
|
||
THE LENDERS
|
||
SIGNED
by
|
)
|
|
Kelina Kantzou
|
)
|
/s/ Kelina Kantzou
|
for and on behalf of
|
)
|
|
ABN AMRO BANK N.V.
|
)
|
|
in the presence of:
|
)
|
|
/s/ Kylie Gue
|
||
THE AGENT
|
||
SIGNED
by
|
)
|
|
Kelina Kantzou
|
)
|
/s/ Kelina Kantzou
|
for and on behalf of
|
)
|
|
ABN AMRO BANK N.V.
|
)
|
|
in the presence of:
|
)
|
|
/s/ Kylie Gue
|
||
THE ARRANGER
|
||
SIGNED
by
|
)
|
|
Kelina Kantzou
|
)
|
/s/ Kelina Kantzou
|
for and on behalf of
|
)
|
|
ABN AMRO BANK N.V.
|
)
|
|
in the presence of:
|
)
|
|
/s/ Kylie Gue
|
||
THE SECURITY TRUSTEE
|
||
SIGNED
by
|
)
|
|
Kelina Kantzou
|
)
|
/s/ Kelina Kantzou
|
for and on behalf of
|
)
|
|
ABN AMRO BANK N.V.
|
)
|
|
in the presence of:
|
)
|
|
/s/ Kylie Gue
|
||
THE SWAP BANK
|
||
SIGNED
by
|
)
|
|
Kelina Kantzou
|
)
|
/s/ Kelina Kantzou
|
for and on behalf of
|
)
|
|
ABN AMRO BANK N.V.
|
)
|
|
in the presence of:
|
)
|
|
/s/ Kylie Gue
|
||
Clause
|
Page
|
|
1
|
Interpretation
|
1
|
2
|
Facility
|
16
|
3
|
Position of the Lenders and the Swap Bank
|
17
|
4
|
Drawdown
|
17
|
5
|
Interest
|
18
|
6
|
Interest Periods
|
21
|
7
|
Default Interest
|
21
|
8
|
Repayment and Prepayment
|
22
|
9
|
Conditions Precedent
|
25
|
10
|
Representations and Warranties
|
26
|
11
|
General Undertakings
|
29
|
12
|
Corporate Undertakings
|
33
|
13
|
Insurance
|
34
|
14
|
Ship Covenants
|
39
|
15
|
Security Cover
|
43
|
16
|
Payments and Calculations
|
45
|
17
|
Application of Receipts
|
47
|
18
|
Application of Earnings, Swap Payments
|
48
|
19
|
Events of Default
|
49
|
20
|
Fees and Expenses
|
54
|
21
|
Indemnities
|
55
|
22
|
No Set-off or Tax Deduction
|
58
|
23
|
Illegality, etc.
|
60
|
24
|
Increased Costs
|
61
|
25
|
Set-off
|
62
|
26
|
Transfers and Changes in Lending Offices
|
63
|
27
|
Variations and Waivers
|
67
|
28
|
Notices
|
68
|
29
|
Supplemental
|
70
|
30
|
Law and Jurisdiction
|
71
|
Schedule 1 Lenders and Commitments
|
72
|
|
Schedule 2 Drawdown Notice
|
73
|
|
Schedule 3 Condition Precedent Documents
|
74
|
|
Schedule 4 Transfer Certificate
|
76
|
|
Execution Page
|
80
|
(1) |
WAKE SHIPPING COMPANY INC.,
a corporation incorporated in the Republic of The Marshall Islands whose registered office is at Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, Marshall Islands, MH 96960, as
Borrower.
|
(2) |
THE BANKS AND FINANCIAL INSTITUTIONS
listed in Schedule 1, as
Lenders.
|
(3) |
DNB BANK ASA and THE EXPORT-IMPORT BANK OF CHINA
as
Mandated Lead Arrangers;
|
(4) |
DNB BANK ASA,
acting through its office at 8
th
Floor, The Walbrook Building, 25 Walbrook, London EC4N 8AF, England, as
Agent.
|
(5) |
DNB BANK ASA,
acting through its office at 8th Floor, The Walbrook Building, 25 Walbrook, London EC4N 8AF, England, as
Security Trustee.
|
(6) |
DNB BANK ASA,
acting through its office at 8t
h
Floor, The Walbrook Building, 25 Walbrook, London EC4N 8AF, England, as
Swap Bank.
|
(A) |
The Lenders have agreed to make available to the Borrower a senior secured term loan facility, in a single advance, in an amount of US$13,510,000 for the purpose of financing the acquisition cost of the Ship.
|
(B) |
The Swap Bank has agreed to enter into interest rate swap transactions with the Borrower from time to time to hedge the Borrower's exposure under this Agreement to interest rate fluctuations.
|
(C) |
The Swap Bank has agreed to share with the Lenders, on a subordinated basis, the security to be granted to the Security Trustee pursuant to this Agreement.
|
1.1 |
Definitions
|
(a) |
the date falling 30 days from the date of this Agreement, or such later date as the Agent may, with the authorisation of the Majority Lenders, agree with the Borrower; o
r
|
(b) |
if earlier, the date on which the Total Commitments are fully borrowed, cancelled or terminated;
|
(a) |
the agreements on capital requirements, a leverage ratio and liquidity standards contained in "Basel III: A global regulatory framework for more resilient banks and banking systems", "Basel III: International framework for liquidity risk measurement, standards and monitoring" and "Guidance for national authorities operating the countercyclical capital buffer" published by the Basel Committee on Banking Supervision in December 2010, each as amended, supplemented or restated;
|
(b) |
the rules for global systemically important banks contained in "Global systemically important banks: assessment methodology and the additional loss absorbency requirement - Rules text" published by the Basel Committee on Banking Supervision in November 2011, as amended, supplemented or restated; and
|
(c) |
any further guidance or standards published by the Basel Committee on Banking Supervision relating to "Basel III";
|
(a) |
The occurrence of any act, event or circumstance that results in the Designated Family no longer being, either directly or indirectly, the major shareholder of the Corporate Guarantor (excluding any financial institution acting as passive investor); or
|
(c) |
either of the Designated Individuals ceasing to hold an executive position within the management structure of the Corporate Guarantor;
|
(a) |
Mr Simeon Palios;
|
(b) |
all the lineal descendants in direct line of Mr Palios;
|
(c) |
a husband or wife or widower or widow of any of the above persons;
|
(d) |
the estates, trusts or legal representatives of which any of the above persons are the beneficiaries; and each company legally or beneficially owned or (as the case may be) controlled by one or more of the persons or entities which would fall within paragraphs (a) to (d) of this definition;
|
(a) |
it is entered into by the Borrower pursuant to the Master Agreement with the Swap Bank, which, at the time the Transaction is entered into, is also a Lender;
|
(b) |
its purpose is the hedging of the Borrower's exposure under this Agreement to fluctuations in LIBOR arising from the funding of the Loan (or any part thereof) for a period expiring no later than the final Repayment Date; and
|
(c) |
it is designated by the Agent, by delivery by the Agent to the Borrower of a notice of designation as a Designated Transaction for the purposes of the Finance Documents;
|
(a) |
except to the extent that they fall within paragraph (b):
|
(i) |
all freight, hire and passage moneys;
|
(ii) |
compensation payable to the Borrower or the Security Trustee in the event of requisition of the Ship for hire;
|
(iii) |
remuneration for salvage and towage services;
|
(iv) |
demurrage and detention moneys;
|
(v) |
damages for breach (or payments for variation or termination) of any charterparty or other contract for the employment of the Ship; and
|
(vi) |
all moneys which are at any time payable under Insurances in respect of loss of hire; and
|
(b) |
if and whenever the Ship is employed on terms whereby any moneys falling within paragraphs (a)(i) to (vii) are pooled or shared with any other person, that proportion of the net receipts of the relevant pooling or sharing arrangement which is attributable to the Ship;
|
(a) |
any claim by any governmental, judicial or regulatory authority which arises out of an Environmental Incident or an alleged Environmental Incident or which relates to any Environmental Law; or
|
(b) |
any claim by any other person which relates to an Environmental Incident or to an alleged Environmental Incident,
|
(a) |
any release of Environmentally Sensitive Material from the Ship; or
|
(b) |
any incident in which Environmentally Sensitive Material is released from a vessel other than the Ship and which involves a collision between the Ship and such other vessel or some other incident of navigation or operation, in either case, in connection with which the Ship is actually or potentially liable to be arrested, attached, detained or injuncted and/or the Ship and/or the Borrower and/or any operator or manager of the Ship is at fault or allegedly at fault or otherwise liable to any legal or administrative action; or
|
(c) |
any other incident in which Environmentally Sensitive Material is released otherwise than from the Ship and in connection with which the Ship is actually or potentially liable to be arrested and/or where the Borrower and/or any operator or manager of the Ship is at fault or allegedly at fault or otherwise liable to any legal or administrative action;
|
(a) |
sections 1471 to 1474 of the Code or any associated regulations;
|
(b) |
any treaty, law or regulation of any other jurisdiction, or relating to an intergovernmental agreement between the US and any other jurisdiction, which (in either case) facilitates the implementation of any law or regulation referred to in paragraph (a) above; or
|
(c) |
any agreement pursuant to the implementation of any treaty, law or regulation referred to in paragraphs (a) or (b) above with the US Internal Revenue Service, the US government or any governmental or taxation authority in any other jurisdiction.
|
(a) |
this Agreement;
|
(b) |
the Master Agreement;
|
(c) |
the Agency and Trust Agreement;
|
(d) |
the Corporate Guarantee;
|
(e) |
the Master Agreement Assignment;
|
(f) |
the Shares Pledge;
|
(g) |
the General Assignment;
|
(h) |
the Mortgage;
|
(i) |
the Account Pledge;
|
(j) |
any Charterparty Assignment;
|
(k) |
the Approved Manager's Undertaking; and
|
(l) |
any other document (whether creating a Security Interest or not) which is executed at any time by the Borrower, the Corporate Guarantor or any other person as security for, or to establish any form of subordination or priorities arrangement in relation to, any amount payable to the Lenders and/or the Swap Bank under this Agreement or the Master Agreement or any of the other documents referred to in this definition;
|
(a) |
for principal, interest or any other sum payable in respect of any moneys borrowed or raised by the debtor;
|
(b) |
under any loan stock, bond, note or other security issued by the debtor;
|
(c) |
under any acceptance credit, guarantee or letter of credit facility or dematerialised equivalent made available to the debtor;
|
(d) |
under a financial lease, a deferred purchase consideration arrangement or any other agreement having the commercial effect of a borrowing or raising of money by the debtor;
|
(e) |
under any foreign exchange transaction, any interest or currency swap or any other kind of derivative transaction entered into by the debtor or, if the agreement under which any such transaction is entered into requires netting of mutual liabilities, the liability of the debtor for the net amount; or
|
(f) |
under a guarantee, indemnity or similar obligation entered into by the debtor in respect of a liability of another person which would fall within paragraphs (a) to (e) if the references to the debtor referred to the other person;
|
(a) |
all policies and contracts of insurance, including entries of the Ship in any protection and indemnity or war risks association, which are effected in respect of the Ship, the Earnings or otherwise in relation to the Ship whether before, on or after the date of this Agreement; and
|
(b) |
all rights and other assets relating to, or derived from, any of the foregoing, including any rights to a return of a premium and any rights in respect of any claim whether or not the relevant policy, contract of insurance or entry has expired on or before the date of this Agreement;
|
(a) |
before the Loan has been made, Lenders whose Commitments total more than 70 per cent. of the Total Commitments; and
|
(b) |
after the Loan has been made, Lenders whose Contributions total more than 70 per cent. of the Loan;
|
(a) |
the business operations, property, condition (financial or otherwise) or prospects of any Security Party; or
|
(b) |
the ability of a Security Party to perform its obligations under a Finance Document; or
|
(c) |
the validity or enforceability of or the effectiveness or ranking of any Security Interest granted or intended to be granted pursuant to any of the Finance Documents or the rights or remedies of any Creditor Party under any of the Finance Documents;
|
(a) |
Security Interests created by the Finance Documents;
|
(b) |
liens for unpaid master's and crew's wages in accordance with usual maritime practice;
|
(c) |
liens for salvage; and
|
(d) |
liens for master's disbursements incurred in the ordinary course of trading and any other lien arising by operation of law or otherwise in the ordinary course of the operation, repair or maintenance of the Ship, provided such liens do not secure amounts more than 30 days overdue, do not exceed, at any relevant time, in aggregate, $1,000,000 (or the equivalent in any other currency or currencies) and subject, in the case of liens for repair or maintenance, to Clause 14.13(f);
|
(a) |
any Finance Document;
|
(b) |
any policy or contract of insurance contemplated by or referred to in Clause 13 or any other provision of this Agreement or another Finance Document;
|
(c) |
any other document contemplated by or referred to in any Finance Document; and
|
(d) |
any document which has been or is at any time sent by or to a Servicing Bank in contemplation of or in connection with any Finance Document or any policy, contract or document falling within paragraphs (b) or (c);
|
(a) |
England and Wales;
|
(b) |
the country under the laws of which the company is incorporated or formed;
|
(c) |
a country in which the company has the centre of its main interests or in which the company's central management and control is or has recently been exercised;
|
(d) |
a country in which the overall net income of the company is subject to corporation tax, income tax or any similar tax;
|
(e) |
a country in which assets of the company (other than securities issued by, or loans to, related companies) having a substantial value are situated, in which the company maintains a branch or permanent place of business, or in which a Security Interest created by the company must or should be registered in order to ensure its validity or priority; and
|
(f) |
a country the courts of which have jurisdiction to make a winding up, administration or similar order in relation to the company whether as a main or territorial or ancillary proceedings or which would have such jurisdiction if their assistance were requested by the courts of a country referred to in paragraphs (b) or (c) above;
|
(a) |
any transaction or matter contemplated by, arising out of, or in connection with a Pertinent Document; or
|
(b) |
any statement relating to a Pertinent Document or to a transaction or matter falling within paragraph (a), and covers any such transaction, matter or statement, whether entered into, arising or made at any time before the signing of this Agreement or on or at any time after that signing;
|
(a) |
that is listed on any Sanctions List (whether designated by name or by reason of being included in a class of person);
|
(b) |
that is domiciled, registered as located or having its main place of business in, or is incorporated under the laws of, a country or territory that is the target of country-wide or territory-wide Sanctions; or
|
(c) |
that is directly or indirectly owned or controlled by a person referred to in (a) and/or (b) above; or
|
(d) |
with whom a subject of a Sanctions Authority would be prohibited or restricted by law from engaging into trade business or other activities;
|
(a) |
the Norwegian Government;
|
(b) |
the United States Government;
|
(c) |
the United Nations;
|
(d) |
the European Union;
|
(e) |
the United Kingdom, and with regard to (a) - (e) above, the respective governmental institutions and agencies of any of the foregoing, including, without limitation, the Office of Foreign Assets Control of the US Department of Treasury ("OFAC"), the United States Department of State, and Her Majesty's Treasury ("HMT") (together the "
Sanctions Authorities
"
).
|
(a) |
a mortgage, charge (whether fixed or floating) or pledge, any maritime or other lien or any other security interest of any kind;
|
(b) |
the security rights of a plaintiff under an action in rem; and
|
(c) |
any arrangement entered into by a person (A) the effect of which is to place another person (B) in a position which is similar, in economic terms, to the position in which B would have been had he held a security interest over an asset of A; but this paragraph (c) does not apply to a right of set off or combination of accounts conferred by the standard terms of business of a bank or financial institution;
|
(a) |
all amounts which have become due for payment by the Borrower or any Security Party under the Finance Documents have been paid;
|
(b) |
no amount is owing or has accrued (without yet having become due for payment) under any Finance Document;
|
(c) |
neither the Borrower nor any Security Party has any future or contingent liability under Clause 20, 21 or 22 or any other provision of this Agreement or another Finance Document; and
|
(d) |
the Agent, the Security Trustee, the Mandated Lead Arrangers and the Majority Lenders do not consider that there is a significant risk that any payment or transaction under a Finance Document would be set aside, or would have to be reversed or adjusted, in any present or possible future bankruptcy of the Borrower or a Security Party or in any present or possible future proceeding relating to a Finance Document or any asset covered (or previously covered) by a Security Interest created by a Finance Document;
|
(a) |
actual, constructive, compromised, agreed or arranged total loss of the Ship;
|
(b) |
any expropriation, confiscation, requisition or acquisition of the Ship whether for full consideration, a consideration less than its proper value, a nominal consideration or without any consideration, which is effected by any government or official authority or by any person or persons claiming to be or to represent a government or official authority (excluding a requisition for hire for a fixed period not exceeding 1 year without any right to an extension), unless it is within 1 month redelivered to the Borrower's full control;
|
(c) |
any condemnation of the Ship by any tribunal or by any person or persons claiming to be a tribunal; and
|
(d) |
any arrest, capture, seizure or detention of the Ship (including any hijacking, or theft) unless it is within 1 month redelivered to the Borrower's full control of the Borrower;
|
(a) |
in the case of an actual loss of the Ship, the date on which it occurred or, if that is unknown, the date when the Ship was last heard of;
|
(b) |
in the case of a constructive, compromised, agreed or arranged total loss of the Ship, the earliest of:
|
(i) |
the date on which a notice of abandonment is given to the insurers; and
|
(ii) |
the date of any compromise, arrangement or agreement made by or on behalf of the Borrower with the Ship's insurers in which the insurers agree to treat the Ship as a total loss; and
|
(c) |
in the case of any other type of total loss, on the date (or the most likely date) on which it appears to the Agent that the event constituting the total loss occurred;
|
1.2 |
Construction of certain terms
|
1.3 |
Meaning of
"
month
"
|
(a) |
on the Business Day following the numerically corresponding day if the numerically corresponding day is not a Business Day or, if there is no later Business Day in the same calendar month, on the Business Day preceding the numerically corresponding day; or
|
(b) |
on the last Business Day in the relevant calendar month, if the period started on the last Business Day in a calendar month or if the last calendar month of the period has no numerically corresponding day, and "
month
"
and "
monthly
"
shall be construed accordingly.
|
1.4 |
Meaning of
"
subsidiary
"
|
(a) |
a majority of the issued shares in S (or a majority of the issued shares in S which carry unlimited rights to capital and income distributions) are directly owned by P or are indirectly attributable to P; or
|
(b) |
P has direct or indirect control over a majority of the voting rights attaching to the issued shares of 5; or
|
(c) |
P has the direct or indirect power to appoint or remove a majority of the directors of 5; or
|
(d) |
P otherwise has the direct or indirect power to ensure that the affairs of S are conducted in accordance with the wishes of P, and any company of which S is a subsidiary is a parent company of S.
|
1.5 |
General Interpretation
|
(a) |
references to, or to a provision of, a Finance Document or any other document are references to it as amended or supplemented, whether before the date of this Agreement or otherwise;
|
(b) |
references to, or to a provision of, any law include any amendment, extension, re-enactment or replacement, whether made before the date of this Agreement or otherwise;
|
(c) |
words denoting the singular number shall include the plural and vice versa; and
|
(d) |
Clauses 1.1 to 1.5 apply unless the contrary intention appears.
|
1.6 |
Headings
|
2.1 |
Amount of facility
|
2.2 |
Lenders' participations in Loan
|
2.3 |
Purpose of Loan
|
3.1 |
Interests of Lenders and Swap Bank several
|
3.2 |
Individual Lender's or Swap Bank's right of action
|
3.3 |
Proceedings by individual Lender or Swap Bank requiring Majority Lenders' consent
|
3.4 |
Obligations of Lenders and Swap Bank several
|
(a) |
the obligations of the other Lenders or (as the case may be) the Swap Bank being increased; nor
|
(b) |
the Borrower, any Security Party or any other Lender or the Swap Bank being discharged (in whole or in part) from its obligations under any Finance Document, and in no circumstances shall a Lender or the Swap Bank have any responsibility for a failure of another Lender or the Swap Bank to perform its obligations under this Agreement or under the Master Agreement.
|
4.1 |
Request for advance of Loan
|
4.2 |
Availability
|
(a) |
the Drawdown Date has to be a Business Day during the Availability Period;
|
(b) |
the amount of the Loan shall not exceed the amount of $13,510,000, and shall be used in financing the acquisition cost of the Ship; and
|
(c) |
the Loan shall not exceed the Total Commitments.
|
4.3 |
Notification to Lenders of receipt of a Drawdown Notice
|
(a) |
the amount of the Loan and the Drawdown Date;
|
(b) |
the amount of that Lender's participation in the Loan; and
|
(c) |
the duration of the first Interest Period.
|
4.4 |
Drawdown Notice irrevocable
|
4.5 |
Lenders to make available Contributions
|
4.6 |
Disbursement of Loan
|
(a) |
to the account which the Borrower specifies in the Drawdown Notice; and
|
(b) |
in the like funds as the Agent received the payments from the Lenders.
|
4.7 |
Disbursement of Advance to third party
|
5.1 |
Payment of normal interest
|
5.2 |
Normal rate of interest
|
5.3 |
Payment of accrued interest
|
5.4 |
Notification of Interest Periods and rates of normal interest
|
(a) |
each rate of interest; and
|
(b) |
the duration of each Interest Period,
|
5.5 |
Obligation of Reference Banks to quote
|
5.6 |
Absence of quotations by Reference Banks
|
5.7 |
Market disruption
|
(a) |
no screen rate is quoted in the Screen Rate and the Reference Bank does not, before 1.00 p.m. (London time) on the Quotation Date, provide quotations to the Agent in order to fix LIBOR; or
|
(b) |
at least 1 Business Day before the start of an Interest Period, Lenders having Contributions together amounting to 30 per cent. or more of the Loan (or, if the Loan has not been made, Commitments amounting to 30 per cent. or more of the Total Commitments) notify the Agent that LIBOR fixed by the Agent would not accurately reflect the cost to those Lenders of funding their respective Contributions (or any part of them) during the Interest Period in the London Interbank Market at or about 11.00 a.m. (London time) on the Quotation Date for the Interest Period; or
|
(c) |
at least 1 Business Day before the start of an Interest Period, the Agent is notified by a Lender (the "
Affected Lender
"
)
that for any reason it is unable to obtain Dollars in the London Interbank Market in order to fund its Contribution (or any part of it) during the Interest Period.
|
5.8 |
Notification of market disruption
|
5.9 |
Suspension of drawdown
|
(a) |
in a case falling within Clauses 5.7(a) or 5.7(b), the Lenders' obligations to advance the Loan; and
|
(b) |
in a case falling within Clause 5.7(c), the Affected Lender's obligation to participate in the Loan,
|
5.10 |
Negotiation of alternative rate of interest
|
5.11 |
Application of agreed alternative rate of interest
|
5.12 |
Alternative rate of interest in absence of agreement
|
5.13 |
Notice of prepayment
|
5.14 |
Prepayment; termination of Commitments
|
(a) |
on the date on which the Agent serves that notice, the Total Commitments or (as the case may require) the Commitment of the Affected Lender shall be cancelled; and
|
(b) |
on the last Business Day of the interest period set by the Agent, the Borrower shall prepay (without premium or penalty) the Loan or, as the case may be, the Affected Lender's Contribution, together with accrued interest thereon at the applicable rate plus the Margin.
|
5.15 |
Interest rate hedging
|
6.1 |
Commencement of Interest Periods
|
6.2 |
Duration of normal Interest Periods
|
(a) |
3 months; or
|
(b) |
such other period as the Agent may, with the authorisation of the Majority Lenders, agree with the Borrower as notified by the Borrower to the Agent not later than 10.00 a.m. (London time) 3 Business Days before the commencement of the Interest Period.
|
6.3 |
Duration of Interest Periods for Repayment Instalments
|
6.4 |
Non-availability of matching deposits for Interest Period selected
|
7.1 |
Payment of default interest on overdue amounts
|
(a) |
the date on which the Finance Documents provide that such amount is due for payment; or
|
(b) |
if a Finance Document provides that such amount is payable on demand, the date on which the demand is served; or
|
(c) |
if such amount has become immediately due and payable under Clause 19.4, the date on which it became immediately due and payable.
|
7.2 |
Default rate of interest
|
(a) |
in the case of an overdue amount of principal, the higher of the rates set out at paragraphs (a) and (b) of Clause 7.3; or
|
(b) |
in the case of any other overdue amount, the rate set out at paragraph (b) of Clause 7.3.
|
7.3 |
Calculation of default rate of interest
|
(a) |
the rate applicable to the overdue principal amount immediately prior to the relevant date (but only for any unexpired part of any then current Interest Period);
|
(b) |
the aggregate of the Margin and the Mandatory Cost (if any) plus, in respect of successive periods of any duration (including at call) up to 3 months which the Agent may select from time to time:
|
(i) |
LIBOR; or
|
(ii) |
if the Agent (after consultation with the Reference Banks) determines that Dollar deposits for any such period are not being made available to any Reference Bank by leading banks in the London Interbank Market in the ordinary course of business, a rate from time to time determined by the Agent by reference to the cost of funds to the Reference Banks from such other sources as the Agent (after consultation with the Reference Banks) may from time to time determine.
|
7.4 |
Notification of Interest Periods and default rates
|
7.5 |
Payment of accrued default interest
|
7.6 |
Compounding of default interest
|
7.7 |
Application to Master Agreement
|
8.1 |
Amount of Repayment Instalments
|
(a) |
the C-Exim Commitment by:
|
(i) |
11 consecutive quarterly instalments, the first 7 (the "
7 C-Exim Repayment Instalments
"
)
of which shall be in the amount of $19,775 each and the next 4 of which shall be in the amount of $197,750 each (each a "
C-Exim Repayment Instalment
"
and together the "
C-Exim Repayment Instalments
"
);
and
|
(ii) |
a balloon instalment in the amount of $8,527,575 (the "
C-Exim Balloon Instalment
"
);
and
|
(b) |
subject to Clause 8.3, the DNB Commitment by:
|
(i) |
4 equal consecutive quarterly instalments in the amount of $84,750 each (each a "
DNB Repayment Instalment
"
and together the "
DNB Repayment Instalments
"
and together with the C-Exim Repayment Instalments, the "
Repayment Instalments
"
and each a "
Repayment Instalment
"
);
and
|
(ii) |
a balloon instalment in the amount of $3,714,000 (the "
DNB Balloon Instalment
"
and together with the C-Exim Balloon Instalment, the "
Balloon Instalments
"
and each a "
Balloon Instalment
"
),
|
8.2 |
Repayment Dates
|
8.3 |
Prepayment out of Excess Earnings
|
(a) |
the aggregate expenditure necessarily incurred during such Excess Earnings Period by the Borrower in operating, insuring, maintaining, repairing and generally trading the Ship (including, but not limited to, any expenses in respect of dry-docking, special survey and general and administrative expenses paid in respect of the Ship during that Excess Earnings Period any anticipated voyage expenses, as well as any other capitalised expenses as same are defined as per GAAP); and
|
(b) |
the aggregate amount of principal and any accrued interest in respect of the Loan paid pursuant to this Agreement during such Excess Earnings Period,
|
(i) |
FIRST: the aggregate of the DNB Priority Amount for that Excess Earnings Period and any DNB Shortfall Amount(s) from any previous Excess Earnings Period(s) shall be applied against the DNB Commitment; and
|
(ii) |
SECONDLY: any surplus shall be applied against the Loan pro rata to each Lender's Contribution.
|
(i) |
the DNB Commitment, in inverse order of maturity, first against the DNB Balloon Instalment and then the DNB Repayment Instalments then outstanding; and
|
(ii) |
the C-EXIM Commitment, in order of maturity first against the then outstanding 7 C-Exim Repayment Instalments and thereafter against the C-Exim Balloon Instalment.
|
8.4 |
Final Repayment Date
|
8.5 |
Voluntary prepayment
|
8.6 |
Conditions for voluntary prepayment
|
(a) |
a partial prepayment shall be in an amount not less than $500,000 or an integral multiple thereof;
|
(b) |
the Agent has received from the Borrower at least 10 Business Days' prior written notice specifying the amount to be prepaid and the date on which the prepayment is to be made; and
|
(c) |
the Borrower has provided evidence satisfactory to the Agent that any consent required by the Borrower or any Security Party in connection with the prepayment has been obtained and remains in force, and that any regulation relevant to this Agreement which affects the Borrower or any Security Party has been complied with.
|
8.7 |
Effect of notice of prepayment
|
8.8 |
Notification of notice of prepayment
|
8.9 |
Mandatory prepayment
|
(a) |
in the case of a sale, on or before the date on which the sale is completed by delivery of the Ship to the buyer; or
|
(b) |
in the case of a Total Loss, on the earlier of the date falling 180 days after the Total Loss Date and the date of receipt by the Security Trustee of the proceeds of insurance relating to such Total Loss.
|
8.10 |
Amounts payable on prepayment
|
8.11 |
Application of prepayment
|
8.12 |
Prepayment; termination of Commitment
|
(a) |
on the date on which the Agent serves that notice, the Commitment of the Notifying Lender shall be cancelled; and
|
(b) |
on the date specified in its notice of intended prepayment, the Borrower shall prepay (without premium or penalty) the Notifying Lender's Contribution, together with accrued interest thereon at the applicable rate plus the Margin.
|
8.13 |
No reborrowing
|
8.14 |
Unwinding of Designated Transactions
|
9.1 |
Documents, fees and no default
|
(a) |
that on or before the date of this Agreement, the Agent receives:
|
(i) |
the documents described in Part A of Schedule 3 in a form and substance satisfactory to the Agent and its lawyers; and
|
(ii) |
payment in full of any expenses payable pursuant to Clause 20.1;
|
(b) |
that, on or before the Drawdown Date but prior to the advance of the Loan, the Agent receives:
|
(i) |
the documents described in Part B of Schedule 3 in form and substance satisfactory to the Agent and its lawyers;
|
(ii) | payment of all fees payable pursuant to Clause 20.1; and (Hi) | payment in full of any expenses payable pursuant to Clause 20.1; |
(c) |
that at the date of the Drawdown Notice and at the Drawdown Date:
|
(i) |
no Event of Default or Potential Event of Default has occurred or would result from the borrowing of the Loan (other than in connection with Clause 15.1);
|
(ii) |
the representations and warranties in Clause 10 and those of the Borrower or any Security Party which are set out in the other Finance Documents would be true and not misleading if repeated on each of those dates with reference to the circumstances then existing;
|
(iii) |
none of the circumstances contemplated by Clause 5.7 has occurred and is continuing;
|
(iv) |
there has been no Material Adverse Change; and
|
(d) |
that the Agent has received, and found to be acceptable to it, any further opinions, consents, agreements and documents in connection with the Finance Documents which the Agent may, with the authorisation of the Majority Lenders, request by notice to the Borrower prior to the Drawdown Date.
|
10.1 |
General
|
10.2 |
Status
|
10.3 |
Share capital and ownership
|
10.4 |
Corporate power
|
(a) |
to execute the Finance Documents to which the Borrower is a party;
|
(b) |
to borrow under this Agreement to enter into Designated Transactions under the Master Agreement and to make all the payments contemplated by, and to comply with, the Finance Documents to which the Borrower is a party and the Master Agreement; and
|
(c) |
to register the Ship in its ownership under the Marshall Islands Flag.
|
10.5 |
Consents in force
|
10.6 |
Legal validity; effective Security Interests
|
(a) |
constitute the Borrower's legal, valid and binding obligations enforceable against the Borrower in accordance with their respective terms; and
|
(b) |
create legal, valid and binding Security Interests enforceable in accordance with their respective terms over all the assets to which they, by their terms, relate, subject to any relevant insolvency laws affecting creditors' rights generally.
|
10.7 |
No third party Security Interests
|
(a) |
the Borrower will have the right to create all the Security Interests which that Finance Document purports to create; and
|
(b) |
no third party will have any Security Interest (except for Permitted Security Interests) or any other interest, right or claim over, in or in relation to any asset to which any such Security Interest, by its terms, relates.
|
10.8 |
No conflicts
|
(a) |
any law or regulation; or
|
(b) |
the constitutional documents of the Borrower; or
|
(c) |
any contractual or other obligation or restriction which is binding on the Borrower or any of its assets.
|
10.9 |
No withholding taxes
|
10.10 |
No default
|
10.11 |
Information
|
10.12 |
No litigation
|
10.13 |
Compliance with certain undertakings
|
10.14 |
Taxes paid
|
10.15 |
ISM Code, ISPS Code Compliance and Environmental Laws
|
10.16 |
No immunity
|
10.17 |
Material adverse change
|
10.18 |
Solvency
|
10.19 |
No Money laundering
|
10.20 |
Sanctions
|
(a) |
is a Restricted Party; or
|
(b) |
has received notice of or is aware of any claim, action, suit, proceeding or investigation against it with respect to Sanctions by any Sanctions Authority.
|
11.1 |
General
|
11.2 |
Title and negative pledge
|
(a) |
hold the legal title to, and own the entire beneficial interest in the Ship, the Insurances and Earnings, free from all Security Interests and other interests and rights of every kind, except for those created by the Finance Documents and the effect of assignments contained in the Finance Documents; and
|
(b) |
not create or permit to arise any Security Interest (except for Permitted Security Interests) over any other asset, present or future including, but not limited to, the Borrower's rights against the Swap Bank under the Master Agreement or all or any part of the Borrower's interest in any amount payable to the Borrower by the Swap Bank under the Master Agreement.
|
11.3 |
No disposal of assets
|
(a) |
all or a substantial part of its assets, whether by one transaction or a number of transactions, whether related or not; or
|
(b) |
any debt payable to it or any other right (present, future or contingent right) to receive a payment, including any right to damages or compensation, but paragraph (a) does not apply to any charter of the Ship as to which Clause 14.13 applies.
|
11.4 |
No other liabilities or obligations to be incurred
|
(a) |
liabilities and obligations under the Finance Documents to which it is a party;
|
(b) |
liabilities or obligations reasonably incurred in the ordinary course of owning, operating and chartering the Ship; and
|
(c) |
pursuant to any intra-group loans,
provided that
such loans are documented on terms acceptable to the Lenders and then only to the extent that they are subject to such subordination and other documentation as the Agent may require.
|
11.5 |
Information provided to be accurate
|
11.6 |
Provision of financial statements
|
(a) |
as soon as possible, but in no event later than 180 days after the end of each financial year of the Corporate Guarantor (commencing with the financial year ended on 31 December 2015), the annual audited consolidated financial statements of the Group;
|
(b) |
as soon as possible, but in no event later than 90 days after the end of each 6-month period in each financial year of the Corporate Guarantor ending on 30 June and 31 December (commencing with the 6-month period ending on 30 June 2016), the unaudited semi-annual consolidated financial statements of the Group (in the form published in the relevant press release) for that 6-month period certified as to their correctness by the chief financial officer of the Corporate Guarantor; and
|
(c) |
promptly after each request by the Agent, such further financial information about the Borrower, the Ship, any Security Party or the Group or any member thereof as the Agent may require.
|
11.7 |
Form of financial statements
|
(a) |
be prepared in accordance with all applicable laws and GAAP consistently applied;
|
(b) |
give a true and fair view of the state of affairs of the Borrower and the Corporate Guarantor thereof at the date of those financial statements and of its profit for the period to which those financial statements relate; and
|
(c) |
fully disclose or provide for all significant liabilities of the Borrower and the Corporate Guarantor.
|
11.8 |
Shareholder and creditor notices
|
11.9 |
Consents
|
(a) |
for the Borrower to perform its obligations under any Finance Document;
|
(b) |
for the validity or enforceability of any Finance Document; and
|
(c) |
for the Borrower to continue to own and operate the Ship, and the Borrower will comply with the terms of all such consents.
|
11.10 |
Maintenance of Security Interests
|
(a) |
at its own cost, do all that it reasonably can to ensure that any Finance Document validly creates the obligations and the Security Interests which it purports to create; and
|
(b) |
without limiting the generality of paragraph (a) above, at its own cost, promptly register, file, record or enrol any Finance Document with any court or authority in all Pertinent Jurisdictions, pay any stamp, registration or similar tax in all Pertinent Jurisdictions in respect of any Finance Document, give any notice or take any other step which, in the opinion of the Majority Lenders, is or has become necessary or desirable for any Finance Document to be valid, enforceable or admissible in evidence or to ensure or protect the priority of any Security Interest which it creates.
|
11.11 |
Notification of litigation
|
11.12 |
Principal place of business
|
11.13 |
Confirmation of no default
|
(a) |
states that no Event of Default or Potential Event of Default has occurred; or
|
(b) |
states that no Event of Default or Potential Event of Default has occurred, except for a specified event or matter, of which all material details are given.
|
11.14 |
Notification of default
|
(a) |
the occurrence of an Event of Default or a Potential Event of Default; or
|
(b) |
any matter which indicates that an Event of Default or a Potential Event of Default may have occurred,
|
11.15 |
Use of proceeds
|
11.16 |
Sanctions
|
(a) |
Each Obligor shall ensure that no part of the proceeds of the Loan or other transaction(s) contemplated by any Finance Document shall, directly or indirectly, be used or otherwise made available:
|
(i) |
to fund any trade, business or other activity involving any Restricted Party;
|
(ii) |
for the direct or indirect benefit of any Restricted Party; or
|
(iii) |
in any other manner that would reasonably be expected to result in (A) the occurrence of an Event of Default under Clause 19.1(n), or (B) any Party (other than the Obligors) any other person being party to or which benefits from any Finance Document being in breach of any Sanctions (if and to the extent applicable to either of them) or becoming a Restricted Party.
|
(b) |
Each Obligor shall ensure that its assets (including the Ship) shall not be used directly or indirectly:
|
(i) |
by or for the direct or indirect benefit of any Restricted Party; or
|
(ii) |
in any trade which is prohibited under applicable Sanctions or which could expose any Obligor, its assets (including the Ship), any Creditor Party and any other person being party to or which benefits from any Finance Document or the insurers to enforcement proceedings or any other consequences whatsoever arising from Sanctions.
|
(c) |
Each Obligor shall ensure that the Ship shall not carry out any trade to Iranian ports or carry or store/warehouse crude oil, petroleum products or petrochemical products or other products subject to Sanctions if they originate in Iran, or are being exported from Iran to any other country.
|
(d) |
For the avoidance of any doubt, in circumstances where the relevant Approved Flag State in respect of the Ship is likely to be deemed a Restricted Party (in the opinion of the Agent) during the Security Period, the Borrower shall not be in breach of this Clause 11.16 if the conditions for changing the Approved Flag State pursuant to Clause 14.2 are capable of being satisfied by the Borrower prior to the relevant Approved Flag State becoming a Restricted Party for the purposes of any applicable Sanctions.
|
11.17 |
Provision of further information
|
(a) |
to the Borrower, the Ship, the Insurances, the Earnings, the Corporate Guarantor or the Approved Manager;
|
(b) |
to any other matter relevant to, or to any provision of, a Finance Document, which may be requested by the Agent, the Security Trustee, the Swap Bank or any Lender at any time.
|
11.18 |
Provision of copies and translation of documents
|
11.19 |
"
Know your customer
"
checks
|
(a) |
the introduction of or any change in (or in the interpretation, administration or application of) any law or regulation made after the date of this Agreement;
|
(b) |
any change in the status of the Borrower or any Security Party after the date of this Agreement; or
|
(c) |
a proposed assignment or transfer by a Lender of any of its rights and obligations under this Agreement to a party that is not a Lender prior to such assignment or transfer, obliges the Agent or any Lender (or, in the case of paragraph (c), any prospective new Lender) to comply with "know your customer" or similar identification procedures in circumstances where the necessary information is not already available to it, the Borrower shall promptly upon the request of the Agent or the Lender concerned supply, or procure the supply of, such documentation and other evidence as is reasonably requested by the Agent (for itself or on behalf of any Lender) or the Lender concerned (for itself or, in the case of the event described in paragraph (c), on behalf of any prospective new Lender) in order for the Agent, the Lender concerned or, in the case of the event described in paragraph (c), any prospective new Lender to carry out and be satisfied it has complied with all necessary "know your customer" or other similar checks under all applicable laws and regulations pursuant to the transactions contemplated in the Finance Documents.
|
11.20 |
Minimum liquidity
|
12.1 |
General
|
12.2 |
Maintenance of status
|
12.3 |
Negative undertakings
|
(a) |
change the course of its business other than the ownership, chartering and operation of the Ship; or
|
(b) |
pay any dividend or make any other form of distribution; or
|
(c) |
effect any form of redemption, purchase or return of share capital; or
|
(d) |
provide any form of credit or financial assistance to:
|
(i) |
a person who is directly or indirectly interested in the Borrower's share or loan capital; or
|
(ii) |
any company in or with which such a person is directly or indirectly interested or connected,
|
(e) |
open or maintain any account with any bank or financial institution except accounts with the Agent and the Security Trustee for the purposes of the Finance Documents; or
|
(f) |
issue, allot or grant any person a right to any shares in its capital or repurchase or reduce its issued share capital; or
|
(g) |
acquire any shares or other securities other than US or UK Treasury bills and certificates of deposit issued by major North American or European banks, or enter into any transaction in a derivative other than the Designated Transactions under the Master Agreement; or
|
(h) |
enter into any form of amalgamation, merger or de-merger or any form of reconstruction or reorganisation.
|
13.1 |
General
|
13.2 |
Maintenance of obligatory insurances
|
(a) |
fire and usual marine risks (including hull and machinery and excess risks); and
|
(b) |
war risks (including acts of terrorism and piracy); and
|
(c) |
protection and indemnity risks (including maximum cover for pollution liability); and
|
(d) |
any other risks against which the Security Trustee considers, having regard to practices and other circumstances prevailing at the relevant time, it would in the opinion of the Security Trustee be reasonable for the Borrower to insure and which are specified by the Security Trustee by notice to the Borrower.
|
13.3 |
Terms of obligatory insurances
|
(a) |
in Dollars;
|
(b) |
in the case of fire and usual marine risks and war risks, in an amount on an agreed value basis at least the greater of (i) the Market Value of the Ship and (ii) 120 per cent. of the Loan (the "Agreed
Insurance Value
"
);
|
(c) |
in the case of hull and machinery insurance, in an amount on an agreed value basis of at least 80 per cent. of the Agreed Insured Value of the Ship with the remainder of that Agreed Insured Value being covered by hull interest and freight interest covers;
|
(d) |
in the case of oil pollution liability risks, for an aggregate amount equal to the highest level of cover from time to time available under basic protection and indemnity club entry and in the international marine insurance market;
|
(e) |
in relation to protection and indemnity risks in respect of the Ship's full value and tonnage;
|
(f) |
on approved terms; and
|
(g) |
through approved brokers and with approved insurance companies and/or underwriters or, in the case of war risks and protection and indemnity risks, in approved war risks and protection and indemnity risks associations.
|
13.4 |
Further protections for the Creditor Parties
|
(a) |
subject always to paragraph (b), name the Borrower as the sole named assured unless the interest of every other named assured is limited:
|
(i) |
in respect of any obligatory insurances for hull and machinery and war risks:
|
(A) |
to any provable out-of-pocket expenses that it has incurred and which form part of any recoverable claim on underwriters; and
|
(B) |
to any third party liability claims where cover for such claims is provided by the policy (and then only in respect of discharge of any claims made against it); and
|
(ii) |
in respect of any obligatory insurances for protection and indemnity risks, to any recoveries it is entitled to make by way of reimbursement following discharge of any third party liability claims made specifically against it;
|
(b) |
whenever the Security Trustee requires, name (or be amended to name) the Security Trustee as additional named assured for its rights and interests, warranted no operational interest and with full waiver of rights of subrogation against the Security Trustee but without the Security Trustee thereby being liable to pay (but having the right to pay) premiums, calls or other assessments in respect of such insurance;
|
(c) |
name the Security Trustee as loss payee with such directions for payment as the Security Trustee may specify;
|
(d) |
provide that all payments by or on behalf of the insurers under the obligatory insurances to the Security Trustee shall be made without set-off, counterclaim or deductions or condition whatsoever;
|
(e) |
provide that such obligatory insurances shall be primary without right of contribution from other insurances which may be carried by the Security Trustee or any other Creditor Party; and;
|
(f) |
provide that the Security Trustee may make proof of loss if the Borrower fails to do so.
|
13.5 |
Renewal of obligatory insurances The Borrower shall:
|
(a) |
at least 21 days before the expiry of any obligatory insurance:
|
(i) |
notify the Security Trustee of the brokers (or other insurers) and any protection and indemnity or war risks association through or with whom the Borrower proposes to renew that obligatory insurance and of the proposed terms of renewal; and
|
(ii) |
obtain the Security Trustee's approval to the matters referred to in paragraph (i);
|
(b) |
at least 14 days before the expiry of any obligatory insurance, renew that obligatory insurance in accordance with the Security Trustee's approval pursuant to paragraph a); and
|
(c) |
procure that the approved brokers and/or the war risks and protection and indemnity associations with which such a renewal is effected shall promptly after the renewal notify the Security Trustee in writing of the terms and conditions of the renewal.
|
13.6 |
Copies of policies; letters of undertaking
|
(a) |
they will have endorsed on each policy, immediately upon issue, a loss payable clause and a notice of assignment complying with the provisions of Clause 13.4;
|
(b) |
they will hold such policies, and the benefit of such insurances, to the order of the Security Trustee in accordance with the said loss payable clause;
|
(c) |
they will advise the Security Trustee immediately of any material change to the terms of the obligatory insurances;
|
(d) |
they will notify the Security Trustee, not less than 14 days before the expiry of the obligatory insurances, in the event of their not having received notice of renewal instructions from the Borrower or its agents and, in the event of their receiving instructions to renew, they will promptly notify the Security Trustee of the terms of the instructions; and
|
(e) |
they will not set off against any sum recoverable in respect of a claim relating to the Ship under such obligatory insurances any premiums or other amounts due to them or any other person whether in respect of the Ship or otherwise, they waive any lien on the policies or any sums received under them, which they might have in respect of such premiums or other amounts, and they will not cancel such obligatory insurances by reason of non-payment of such premiums or other amounts, and will arrange for a separate policy to be issued in respect of the Ship forthwith upon being so requested by the Security Trustee.
|
13.7 |
Copies of certificates of entry
|
(a) |
a certified copy of the certificate of entry for the Ship;
|
(b) |
a letter or letters of undertaking in such form as may be required by the Security Trustee;
|
(c) |
a certified copy of each certificate of financial responsibility for pollution by oil or other Environmentally Sensitive Material issued by the relevant certifying authority in relation to the Ship.
|
13.8 |
Deposit of original policies
|
13.9 |
Payment of premiums
|
13.10 |
Guarantees
|
13.11 |
Compliance with terms of insurances
|
(a) |
the Borrower shall take all necessary action and comply with all requirements which may from time to time be applicable to the obligatory insurances, and (without limiting the obligation contained in Clause 13.6(c) above) ensure that the obligatory insurances are not made subject to any exclusions or qualifications to which the Security Trustee has not given its prior approval;
|
(b) |
the Borrower shall not make any changes relating to the classification or classification society or manager or operator of the Ship approved by the underwriters of the obligatory insurances;
|
(c) |
the Borrower shall make (and promptly supply copies to the Agent of) all quarterly or other voyage declarations which may be required by the protection and indemnity risks association in which the Ship is entered to maintain cover for trading to the US and Exclusive
|
(d) |
the Borrower shall not employ the Ship, nor allow it to be employed, otherwise than in conformity with the terms and conditions of the obligatory insurances, without first obtaining the consent of the insurers and complying with any requirements (as to extra premium or otherwise) which the insurers specify.
|
13.12 |
Alteration to terms of insurances
|
13.13 |
Settlement of claims
|
13.14 |
Provision of copies of communications
|
(a) |
the approved brokers; and
|
(b) |
the approved protection and indemnity and/or war risks associations; and
|
(c) |
the approved insurance companies and/or underwriters, which relate directly or indirectly to:
|
(i) |
the Borrower's obligations relating to the obligatory insurances including, without limitation, all requisite declarations and payments of additional premiums or calls; and
|
(ii) |
any credit arrangements made between the Borrower and any of the persons referred to in paragraphs (a) or (b) above relating wholly or partly to the effecting or maintenance of the obligatory insurances.
|
13.15 |
Provision of information
|
(a) |
obtaining or preparing any report from an independent marine insurance broker appointed by the Agent as to the adequacy of the obligatory insurances effected or proposed to be effected; and/or
|
(b) |
effecting, maintaining or renewing any such insurances as are referred to in Clause 13.16 below or dealing with or considering any matters relating to any such insurances,
|
13.16 |
Mortgagee's interest and additional perils insurances
|
14.1 |
General
|
14.2 |
Ship's name and registration
|
14.3 |
Repair and classification
|
(a) |
consistent with first-class ship ownership and management practice;
|
(b) |
with a classification society (being a member of the International Association of Classification Societies) acceptable to the Lenders so as to maintain the highest class for its type with such classification society free of any material overdue recommendations and conditions; and
|
(c) |
so as to comply with all laws and regulations applicable to vessels registered at ports in the Approved Flag State or to vessels trading to any jurisdiction to which the Ship may trade from time to time, including but not limited to the ISM Code and the ISPS Code.
|
14.4 |
Classification Society Undertaking
|
(a) |
to send to the Security Trustee, following receipt of a written request from the Security Trustee, certified true copies of all original class records held by the classification society in relation to the Ship;
|
(b) |
to allow the Security Trustee (or its agents), at any time and from time to time, to inspect the original class and related records of the Borrower and the Ship at the offices of the classification society and to take copies of them;
|
(c) |
to notify the Security Trustee immediately in writing if the classification society:
|
(i) |
receives notification from the Borrower or any other person that the Ship's classification society is to be changed; or
|
(ii) |
becomes aware of any facts or matters which may result in or have resulted in a change, suspension, discontinuance, withdrawal or expiry of the Ship's class under the rules or terms and conditions of the Borrower's or the Ship's membership of the classification society;
|
(d) |
following receipt of a written request from the Security Trustee:
|
(i) |
to confirm that the Borrower is not in default of any of its contractual obligations or liabilities to the classification society and, without limiting the foregoing, that it has paid in full all fees or other charges due and payable to the classification society; or
|
(ii) |
if the Borrower is in default of any of its contractual obligations or liabilities to the classification society, to specify to the Security Trustee in reasonable detail the facts and circumstances of such default, the consequences of such default, and any remedy period agreed or allowed by the classification society.
|
14.5 |
Modification
|
14.6 |
Removal of parts
|
14.7 |
Surveys
|
14.8 |
Inspection
|
14.9 |
Prevention of and release from arrest
|
(a) |
all liabilities which give or may give rise to maritime or possessory liens on or claims enforceable against the Ship, the Earnings or the Insurances;
|
(b) |
all taxes, dues and other amounts charged in respect of the Ship, the Earnings or the Insurances; and
|
(c) |
all other outgoings whatsoever in respect of the Ship, the Earnings or the Insurances,
|
14.10 |
Compliance with laws etc.
|
(a) |
comply, or procure compliance with the ISM Code, the ISPS Code, all Environmental Laws, all Sanctions and all other laws or regulations relating to the Ship, its ownership, operation and management or to the business of the Borrower;
|
(b) |
not employ the Ship, nor allow its employment in any manner contrary to any law or regulation in any relevant jurisdiction including but not limited to the ISM Code and the ISPS Code; and
|
(c) |
in the event of hostilities in any part of the world (whether war is declared or not), not cause or permit the Ship to enter or trade to any zone which is declared a war zone by any government or by the Ship's war risks insurers unless the prior written consent of the Security Trustee has been given and the Borrower has (at its expense) effected any special, additional or modified insurance cover which the Security Trustee may require.
|
14.11 |
Provision of information
|
(a) |
the Ship, its employment, position and engagements;
|
(b) |
the Earnings and payments and amounts due to the Ship's master and crew of the Ship;
|
(c) |
any expenses incurred, or likely to be incurred, in connection with the operation, maintenance or repair of the Ship and any payments made in respect of the Ship;
|
(d) |
any towages and salvages; and
|
(e) |
the Borrower's, the Approved Manager's compliance or the compliance of the Ship with the ISM Code and the ISPS Code and any Sanctions Laws,
|
14.12 |
Notification of certain events
|
(a) |
any casualty which is or is likely to be or to become a Major Casualty;
|
(b) |
any occurrence as a result of which the Ship has become or is, by the passing of time or otherwise, likely to become a Total Loss;
|
(c) |
any requirement or recommendation made by any insurer or classification society or by any competent authority which is not immediately complied with;
|
(d) |
any arrest or detention of the Ship, any exercise or purported exercise of any lien on the Ship or the Earnings or any requisition of the Ship for hire;
|
(e) |
any intended dry docking of the Ship;
|
(f) |
any Environmental Claim made against the Borrower or in connection with the Ship, or any Environmental Incident;
|
(g) |
any claim for breach of the ISM Code or the ISPS Code being made against the Borrower, the Approved Manager or otherwise in connection with the Ship; or
|
(h) |
any other matter, event or incident, actual or threatened, the effect of which will or could lead to the ISM Code or the ISPS Code not being complied with, and the Borrower shall keep the Security Trustee advised in writing on a regular basis and in such detail as the Security Trustee shall require of the Borrower's and the Approved Manager's response to any of those events or matters.
|
14.13 |
Restrictions on chartering, appointment of managers etc.
|
(a) |
let the Ship on demise charter for any period;
|
(b) |
enter into any charter in relation to the Ship under which more than 2 months' hire (or the equivalent) is payable in advance;
|
(c) |
charter the Ship otherwise than on bona fide arm's length terms at the time when the Ship is fixed;
|
(d) |
appoint a manager of the Ship other than the Approved Manager or agree to any alteration to the terms of the Approved Manager's appointment;
|
(e) |
de-activate or lay up the Ship; or
|
(f) |
put the Ship into the possession of any person for the purpose of work being done upon it in an amount exceeding or likely to exceed $1,000,000 (or the equivalent in any other currency) unless that person has first given to the Security Trustee and in terms satisfactory to it a written undertaking not to exercise any lien on the Ship or the Earnings for the cost of such work or for any other reason.
|
14.14 |
Notice of Mortgage
|
14.15 |
Sharing of Earnings
|
(a) |
enter into any agreement or arrangement for the sharing of any Earnings;
|
(b) |
enter into any agreement or arrangement for the postponement of any date on which any Earnings are due; the reduction of the amount of any Earnings or otherwise for the release or adverse alteration of any right of the Borrower to any Earnings; or
|
(c) |
enter into any agreement or arrangement for the release of, or adverse alteration to, any guarantee or Security Interest relating to any Earnings.
|
14.16 |
Charterparty Assignment
|
(a) |
serve notice of the Charterparty Assignment on the relevant charterer and procure that the charterer acknowledges such notice in such form as the Agent may approve or require; and
|
(b) |
deliver to the Agent such other documents equivalent to those referred to at paragraphs 3, 4, 5 and 6 of Part A of Schedule 3 as the Agent may require.
|
14.17 |
ISPS Code
|
(a) |
procure that the Ship and the company responsible for the Ship's compliance with the ISPS Code comply with the ISPS Code; and
|
(b) |
maintain for the Ship an ISSC; and
|
(c) |
notify the Agent immediately in writing of any actual or threatened withdrawal, suspension, cancellation or modification of the ISSC.
|
15.1 |
Minimum required security cover
|
(a) |
the Market Value of the Ship; plus
|
(b) |
the net realisable value of any additional security previously provided under this Clause 15,
|
(i) |
from the Drawdown Date until the date falling on the first anniversary of the Drawdown Date (the "
First Security Cover Period
"
),
90 per cent.;
|
(ii) |
from the last day of the First Security Cover Period until the date falling on the first anniversary of the First Security Cover Period, 105 per cent.; and
|
(iii) |
at any time thereafter, 125 per cent.
|
15.2 |
Provision of additional security; prepayment
|
15.3 |
Valuation of Ship
|
(a) |
as at a date not more than 30 days previously;
|
(b) |
by an Approved Broker (selected by the Borrowers) appointed by the Agent and addressed to the Agent;
|
(c) |
with or without physical inspection of the Ship (as the Agent may require);
|
(d) |
on the basis of a sale for prompt delivery for cash on normal arm's length commercial terms as between a willing seller and a willing buyer, free of any existing charter or other contract of employment; and
|
(e) |
after deducting the estimated amount of the usual and reasonable expenses which would be incurred in connection with the sale.
|
15.4 |
Value of additional vessel security
|
15.5 |
Valuations binding
|
15.6 |
Provision of information
|
15.7 |
Payment of valuation expenses
|
15.8 |
Frequency of valuations
|
15.9 |
Application of prepayment
|
16.1 |
Currency and method of payments
|
(a) |
by not later than 11.00 a.m. (New York City time) on the due date;
|
(b) |
in same day Dollar funds settled through the New York Clearing House Interbank Payments System (or in such other Dollar funds and/or settled in such other manner as the Agent shall specify as being customary at the time for the settlement of international transactions of the type contemplated by this Agreement);
|
(c) |
in the case of an amount payable by a Lender to the Agent or by the Borrower to the Agent or any Lender, to the account of the Agent at DNB BANK ASA, (DNB Bank ASA, Ship Finance, IBAN: CH92 0483 5950 0000 9878 0, SWIFT: CRESCHZZ40A) or to such other account with such other bank as the Agent may from time to time notify to the Borrower and the other Creditor Parties; and
|
(d) |
in the case of an amount payable to the Security Trustee, to such account as it may from time to time notify to the Borrower and the other Creditor Parties.
|
16.2 |
Payment on non-Business Day
|
(a) |
the due date shall be extended to the next succeeding Business Day; or
|
(b) |
if the next succeeding Business Day falls in the next calendar month, the due date shall be brought forward to the immediately preceding Business Day, and interest shall be payable during any extension under paragraph (a) at the rate payable on the original due date.
|
16.3 |
Basis for calculation of periodic payments
|
16.4 |
Distribution of payments to Creditor Parties
|
(a) |
any amount received by the Agent under a Finance Document for distribution or remittance to a Lender, the Swap Bank or the Security Trustee shall be made available by the Agent to that Lender, the Swap Bank or, as the case may be, the Security Trustee by payment, with funds having the same value as the funds received, to such account as the Lender, or the
|
(b) |
amounts to be applied in satisfying amounts of a particular category which are due to the Lenders and/or the Swap Bank shall be distributed by the Agent to each Lender and the Swap Bank pro rata to the amount in that category which is due to it.
|
16.5 |
Permitted deductions by Agent
|
16.6 |
Agent only obliged to pay when monies received
|
16.7 |
Refund to Agent of monies not received
|
(a) |
refund the sum in full to the Agent; and
|
(b) |
pay to the Agent the amount (as certified by the Agent) which will indemnify the Agent against any funding or other loss, liability or expense incurred by the Agent as a result of making the sum available before receiving it.
|
16.8 |
Agent may assume receipt
|
16.9 |
Creditor Party accounts
|
16.10 |
Agent's memorandum account
|
16.11 |
Accounts prima facie evidence
|
17.1 |
Normal order of application
|
(a) |
FIRST: in or towards satisfaction of any amounts then due and payable under the Finance Documents (other than under the Master Agreement) in the following order and proportions:
|
(i) |
first, in or towards satisfaction pro rata of all amounts then due and payable to the Creditor Parties under the Finance Documents (other than the Master Agreement) other than those amounts referred to at paragraphs (a)(ii) and (a)(iii) (including, but without limitation, all amounts payable by the Borrower under Clauses 20, 21 and 22 of this Agreement or by the Borrower or any Security Party under any corresponding or similar provision in any other Finance Document (other than the Master Agreement);
|
(ii) |
secondly, in or towards satisfaction pro rata of any and all amounts of interest or default interest payable to the Creditor Parties under the Finance Documents (other than under the Master Agreement); and
|
(iii) |
thirdly, in or towards satisfaction of the Loan;
|
(b) |
SECONDLY: in retention of an amount equal to any amount not then due and payable under any Finance Document (other than the Master Agreement) but which the Agent, by notice to the Borrower, the Security Parties and the other Creditor Parties, states in its opinion will or may become due and payable in the future and, upon those amounts becoming due and payable, in or towards satisfaction of them in accordance with the foregoing provisions of this Clause;
|
(c) |
THIRDLY: in or towards satisfaction of any amounts then due and payable under the Master Agreement in the following order and proportions:
|
(i) |
first, in or towards satisfaction pro rata of all amounts then due and payable to the Swap Bank under the Master Agreement other than those amounts referred to at paragraphs (b)(ii) and (b)(iii);
|
(ii) |
secondly, in or towards satisfaction pro rata of any and
all
amounts of interest or default interest payable to the Swap Bank under the Master Agreement (and, for this purpose, the expression "
interest
"
shall include any net amount which the Borrower shall have become liable to pay or deliver under section 2(e) (Obligations) of each Master Agreement but shall have failed to pay or deliver to the relevant Swap Bank (or any of them) at the time of application or distribution under this Clause 17); and
|
(iii) |
thirdly, in or towards satisfaction pro rata of the aggregate Swap Exposure (calculated as at the actual Early Termination Date applying to each particular Designated Transaction entered into under the Master Agreement (or any of them), or if no such Early Termination Date shall have occurred, calculated as if an Early Termination Date occurred on the date of application or distribution hereunder and pro rata as between them);
|
(d) |
FOURTHLY: in retention of an amount equal to any amount not then due and payable under any Finance Document (other than the Master Agreement) but which the Agent, by notice to the Borrower, the Security Parties and the other Creditor Parties, states in its opinion will or
|
(e) |
FIFTHLY: in retention of an amount equal to any amount not then due under and payable under the Master Agreement but which the Swap Bank, by notice to the Borrower, the Security Parties and the other Creditor Parties, states in its opinion will or may become due and payable in the future and, upon those amounts becoming due and payable, in or towards satisfaction of them in accordance with the foregoing provisions of this Clause; and
|
(f) |
SIXTHLY: any surplus shall be paid to the Borrower or to any other person appearing to be entitled to it.
|
17.2 |
Variation of order of application
|
17.3 |
Notice of variation of order of application
|
17.4 |
Appropriation rights overridden
|
18.1 |
Payment of Earnings and Swap Payments
|
(a) |
(subject only to the provisions of the General Assignment), all the Earnings of the Ship are paid to the Earnings Account; and
|
(b) |
all payments by the Swap Bank to the Borrower under each Designated Transaction are paid to the Earnings Account.
|
18.2 |
Location of account
|
(a) |
comply with any requirement of the Agent as to the location or re-location of the Earnings Account; and
|
(b) |
execute any documents which the Agent specifies to create or maintain in favour of the Security Trustee a Security Interest over (and/or rights of set-off, consolidation or other rights in relation to) the Earnings Account.
|
18.3 |
Debits for expenses etc.
|
18.4 |
Borrower's obligations unaffected
|
(a) |
the liability of the Borrower to make payments of principal and interest on the due dates; or
|
(b) |
any other liability or obligation of the Borrower or any Security Party under any Finance Document.
|
18.5 |
Earnings Account Balances
|
19.1 |
Events of Default
|
(a) |
the Borrower or any Security Party fails to pay when due or (if so payable) on demand any sum payable under a Finance Document or under any document relating to a Finance Document; or
|
(b) |
any breach occurs of Clause 11.2, 11.3, 11.18, 11.19, 11.20, 11.21, 12.2, 12.3, 13.2, 13.3, 14.2, 14.3, 15.2; or
|
(c) |
any breach by the Borrower or any Security Party occurs of any provision of a Finance Document (other than a breach covered by paragraphs (a) or (b) above) which, in the opinion of the Majority Lenders, is capable of remedy, and such default continues unremedied 10 Business Days after written notice from the Agent requesting action to remedy the same; or
|
(d) |
(subject to any applicable grace period specified in the Finance Document) any breach by the Borrower or any Security Party occurs of any provision of a Finance Document (other than a breach falling within paragraphs (a), (b) or (c) above); or
|
(e) |
any representation, warranty or statement made or repeated by, or by an officer of, the Borrower or a Security Party in a Finance Document or in a Drawdown Notice or any other notice or document relating to a Finance Document is untrue or misleading when it is made or repeated; or
|
(f) |
any of the following occurs in relation to any Financial Indebtedness of a Relevant Person:
|
(i) |
any Financial Indebtedness of a Relevant Person is not paid when due or, if so payable, on demand; or
|
(ii) |
any Financial Indebtedness of a Relevant Person becomes due and payable or capable of being declared due and payable prior to its stated maturity date as a consequence of any event of default; or
|
(iii) |
a lease, hire purchase agreement or charter creating any Financial Indebtedness of a Relevant Person is terminated by the lessor or owner or becomes capable of being terminated as a consequence of any termination event; or
|
(iv) |
any overdraft, loan, note issuance, acceptance credit, letter of credit, guarantee, foreign exchange or other facility, or any swap or other derivative contract or transaction, relating to any Financial Indebtedness of a Relevant Person ceases to be available or becomes capable of being terminated as a result of any event of default, or cash cover is required, or becomes capable of being required, in respect of such a facility as a result of any event of default; or
|
(v) |
any Security Interest securing any Financial Indebtedness of a Relevant Person becomes enforceable; or
|
(g) |
any of the following occurs in relation to a Relevant Person:
|
(i) |
a Relevant Person becomes, in the opinion of the Majority Lenders, unable to pay its debts as they fall due; or
|
(ii) |
any assets of a Relevant Person are subject to any form of execution, attachment, arrest, sequestration or distress in respect of a sum of, or sums aggregating, $10,000,000 or more or the equivalent in another currency in the case of the Corporate Guarantor and, $500,000 or more or the equivalent in another currency in the case of any other Relevant Person Provided that in the case of an arrest of a Ship, no Event of Default shall occur under this paragraph (ii) if the arrest is discharged, dismissed or released within 30 days of its commencement; or
|
(iii) |
any administrative or other receiver is appointed over any asset of a Relevant Person; or
|
(iv) |
an administrator is appointed (whether by the court or otherwise) in respect of a Relevant Person; or
|
(v) |
any formal declaration of bankruptcy or any formal statement to the effect that a Relevant Person is insolvent is made by a Relevant Person or by the directors of a Relevant Person or, in any proceedings, by a lawyer acting for a Relevant Person; or
|
(vi) |
a provisional liquidator is appointed in respect of a Relevant Person, a winding up order is made in relation to a Relevant Person or a winding up resolution is passed by a Relevant Person; or
|
(vii) |
a resolution is passed, an administration notice is given or filed, an application or petition to a court is made or presented or any other step is taken by (aa) a Relevant Person, (bb) the members or directors of a Relevant Person, (cc) a holder of Security Interests which together relate to all or substantially all of the assets of a Relevant Person, or (dd) a government minister or public or regulatory authority of a Pertinent Jurisdiction for or with a view to the winding up of that or another
|
(viii) |
an administration notice is given or filed, an application or petition to a court is made or presented or any other step is taken by a creditor of a Relevant Person (other than a holder of Security Interests which together relate to all or substantially all of the assets of a Relevant Person) for the winding up of a Relevant Person or the appointment of a provisional liquidator or administrator in respect of a Relevant Person in any Pertinent Jurisdiction, unless the proposed winding up, appointment of a provisional liquidator or administration is being contested in good faith, on substantial grounds and not with a view to some other insolvency law procedure being implemented instead and either (aa) the application or petition is dismissed or withdrawn within 30 days of being made or presented, or (bb) within 30 days of the administration notice being given or filed, or the other relevant steps being taken, other action is taken which will ensure that there will be no administration and (in both cases (aa) or (bb)) the Relevant Person will continue to carry on business in the ordinary way and without being the subject of any actual, interim or pending insolvency law procedure; or
|
(ix) |
a Relevant Person or its directors take any steps (whether by making or presenting an application or petition to a court, or submitting or presenting a document setting out a proposal or proposed terms, or otherwise) with a view to obtaining, in relation to that or another Relevant Person, any form of moratorium, suspension or deferral of payments, reorganisation of debt (or certain debt) or arrangement with all or a substantial proportion (by number or value) of creditors or of any class of them or any such moratorium, suspension or deferral of payments, reorganisation or arrangement is effected by court order, by the filing of documents with a court, by means of a contract or in any other way at all; or
|
(x) |
any meeting of the members or directors, or of any committee of the board or senior management, of a Relevant Person is held or summoned for the purpose of considering a resolution or proposal to authorise or take any action of a type described in paragraphs (iv) to (ix) or a step preparatory to such action, or (with or without such a meeting) the members, directors or such a committee resolve or agree that such an action or step should be taken or should be taken if certain conditions materialise or fail to materialise; or
|
(xi) |
in a Pertinent Jurisdiction other than England, any event occurs, any proceedings are opened or commenced or any step is taken which, in the opinion of the Majority Lenders is similar to any of the foregoing; or
|
(h) |
the Borrower ceases or suspends carrying on its business or a part of its business which, in the opinion of the Majority Lenders, is material in the context of this Agreement; or
|
(i) |
it becomes unlawful in any Pertinent Jurisdiction or impossible:
|
(i) |
for the Borrower or any Security Party to discharge any liability under a Finance Document or to comply with any other obligation which the Majority Lenders consider material under a Finance Document; or
|
(ii) |
for the Agent, the Security Trustee or the Lenders or the Swap Bank to exercise or enforce any right under, or to enforce any Security Interest created by, a Finance Document; or
|
(j) |
any consent necessary to enable the Borrower to own, operate or charter the Ship or to enable the Borrower or any Security Party to comply with any provision which the Majority Lenders consider material of a Finance Document is not granted, expires without being renewed, is revoked or becomes liable to revocation or any condition of such a consent is not fulfilled; or
|
(k) |
any provision which the Majority Lenders consider material of a Finance Document proves to have been or becomes invalid or unenforceable, or a Security Interest created by a Finance Document proves to have been or becomes invalid or unenforceable or such a Security Interest proves to have ranked after, or loses its priority to, another Security Interest or any other third party claim or interest; or
|
(l) |
the shares of the Corporate Guarantor cease to be listed on the New York Stock Exchange; or
|
(m) |
without the Majority Lenders' prior written consent, a Change of Control has occurred after the date of this Agreement; or
|
(n) |
the security constituted by a Finance Document is in any way imperilled or in jeopardy; or
|
(o) |
an Event of Default (as defined in Section 14 of the Master Agreement) occurs or the Master Agreement is terminated, cancelled, suspended, rescinded or revoked or otherwise ceases to remain in full force and effect tor any reason except with the consent of the Agent, acting with the authorisation of the Majority Lenders; or
|
(p) |
any other event occurs or any other circumstances arise or develop which constitutes a Material Adverse Change; or
|
(q) |
the Borrower ceases to be a wholly-owned subsidiary of the Corporate Guarantor; or
|
(r) |
any Obligor, any of their joint ventures or respective directors, officers, employees, agents or representatives or any other persons acting on any of their behalf becomes a Restricted Party.
|
19.2 |
Actions following an Event of Default
|
(a) |
the Agent may, and if so instructed by the Majority Lenders, the Agent shall:
|
(i) |
serve on the Borrower a notice stating that all or part of the Commitments and of the other obligations of each Lender to the Borrower under this Agreement are cancelled; and/or
|
(ii) |
serve on the Borrower a notice stating that all or part of the Loan together with accrued interest and all other amounts accrued or owing under this Agreement are immediately due and payable or are due and payable on demand; and/or
|
(iii) |
take any other action which, as a result of the Event of Default or any notice served under paragraph (i) or (ii) above, the Agent and/or the Lenders are entitled to take under any Finance Document or any applicable law; and/or
|
(b) |
the Security Trustee may, and if so instructed by the Agent, acting with the authorisation of the Majority Lenders, the Security Trustee shall take any action which, as a result of the
|
19.3 |
Termination of Commitments
|
19.4 |
Acceleration of Loan
|
19.5 |
Multiple notices; action without notice
|
19.6 |
Notification of Creditor Parties and Security Parties
|
19.7 |
Creditor Party's rights unimpaired
|
19.8 |
Exclusion of Creditor Party liability
|
(a) |
for any loss caused by an exercise of rights under, or enforcement of a Security Interest created by, a Finance Document or by any failure or delay to exercise such a right or to enforce such a Security Interest; or
|
(b) |
as mortgagee in possession or otherwise, for any income or principal amount which might have been produced by or realised from any asset comprised in such a Security Interest or for any reduction (however caused) in the value of such an asset,
|
19.9 |
Relevant Persons
|
19.10 |
Interpretation
|
19.11 |
Position of Swap Bank
|
20.1 |
Costs of negotiation, preparation etc.
|
20.2 |
Costs of variations, amendments, enforcement etc.
|
(a) |
any amendment or supplement to a Finance Document, or any proposal for such an amendment to be made;
|
(b) |
any consent or waiver by the Lenders, the Swap Bank, the Majority Lenders or the Creditor Party concerned under or in connection with a Finance Document, or any request for such a consent or waiver;
|
(c) |
the valuation of any security provided or offered under Clause 15 or any other matter relating to such security;
|
(d) |
where the Agent, in its absolute opinion, considers that there has been a material change to the insurances in respect of the Ship, the review of the insurances of the Ship pursuant to Clause13.2; or
|
(e) |
any step taken by the Lender concerned or the Swap Bank with a view to the protection, exercise or enforcement of any right or Security Interest created by a Finance Document or for any similar purpose.
|
20.3 |
Documentary taxes
|
20.4 |
Certification of amounts
|
21.1 |
Indemnities regarding borrowing and repayment of Loan
|
(a) |
the Loan not being borrowed on the date specified in the Drawdown Notice for any reason other than a default by the Lender or the Swap Bank claiming the indemnity;
|
(b) |
the receipt or recovery of all or any part of the Loan or an overdue sum otherwise than on the last day of an Interest Period or other relevant period;
|
(c) |
any failure (for whatever reason) by the Borrower to make payment of any amount due under a Finance Document on the due date or, if so payable, on demand (after giving credit for any default interest paid by the Borrower on the amount concerned under Clause 7); and
|
(d) |
the occurrence and/or continuance of an Event of Default or a Potential Event of Default and/or the acceleration of repayment of the Loan under Clause 19, and in respect of any tax (other than tax on its overall net income) for which a Creditor Party is liable in connection with any amount paid or payable to that Creditor Party (whether for its own account or otherwise) under any Finance Document.
|
21.2 |
Breakage costs
|
(a) |
in liquidating or employing deposits from third parties acquired or arranged to fund or maintain all or any part of its Contribution and/or any overdue amount (or an aggregate amount which includes its Contribution or any overdue amount); and
|
(b) |
in terminating, or otherwise in connection with, any interest and/or currency swap or any other transaction entered into (whether with another legal entity or with another office or department of the Lender concerned) to hedge any exposure arising under this Agreement or that part which the Lender concerned determines is fairly attributable to this Agreement of the amount of the liabilities, expenses or losses (including losses of prospective profits) incurred by it in terminating, or otherwise in connection with, a number of transactions of which this Agreement is one.
|
21.3 |
Miscellaneous indemnities
|
(a) |
any action taken, or omitted or neglected to be taken, under or in connection with any Finance Document by the Agent, the Security Trustee or any other Creditor Party or by any receiver appointed under a Finance Document; or
|
(b) |
any other Pertinent Matter, other than claims, expenses, liabilities and losses which are shown to have been directly and mainly caused by the dishonesty or wilful misconduct of the officers or employees of the Creditor Party concerned.
|
21.4 |
Currency indemnity
|
(a) |
making or lodging any claim or proof against the Borrower or any Security Party, whether in its liquidation, any arrangement involving it or otherwise; or
|
(b) |
obtaining an order or judgment from any court or other tribunal; or
|
(c) |
enforcing any such order or judgment,
|
21.5 |
Certification of amounts
|
21.6 |
Sums deemed due to a Lender
|
21.7 |
Application to Master Agreement
|
21.8 |
Tax indemnity
|
(a) |
The Borrower shall (within five Business Days of demand by the Agent) pay to a Protected Party an amount equal to the loss or cost which that Protected Party has suffered for or on account of Tax by that Protected Party in respect of a Finance Document.
|
(b) |
Paragraph (a) above shall not apply:
|
(i) |
with respect to any Tax assessed on a Creditor Party:
|
(A) |
under the law of the jurisdiction in which that Creditor Party is incorporated or, if different, the jurisdiction (or jurisdictions) in which that Creditor Party is treated as resident for tax purposes; or
|
(B) |
under the law of the jurisdiction in which that Creditor Party's Facility Office is located in respect of amounts received or receivable in that jurisdiction,
|
(ii) |
to the extent a loss or cost is compensated for by an increased payment under Clause 22.2 or relates to a FATCA Deduction required to be made by a Party.
|
(c) |
A Protected Party making, or intending to make, a claim under paragraph (a) above shall promptly notify the Agent of the event which will give, or has given, rise to the claim, following which the Agent shall notify the Borrower.
|
(d) |
A Protected Party shall, on receiving a payment from an Obligor under this Clause 21.8, notify the Agent.
|
21.9 |
Mandatory Cost
|
(a) |
in the case of a Lender lending from an office in a Participating Member State, the minimum reserve requirements (or other requirements having the same or similar purpose) of the European Central Bank or any other authority or agency which replaces all or any of its functions) in respect of loans made from that office; and
|
(b) |
in the case of any Lender lending from an office in the United Kingdom, any reserve asset, special deposit or liquidity requirements (or other requirements having the same or similar purpose) of the Bank of England (or any other governmental authority or agency) and/or paying any fees to the Financial Conduct Authority and/or the Prudential Regulation
|
22.1 |
No deductions
|
(a) |
without any form of set-off, cross-claim or condition; and
|
(b) |
free and clear of any tax deduction except a tax deduction which the Borrower is required by law to make.
|
22.2 |
Grossing-up for taxes
|
22.3 |
Evidence of payment of taxes
|
(a) |
If a Tax Deduction is required by law to be made by an Obligor, the amount of the payment due from that Obligor shall be increased to an amount which (after making any Tax Deduction) leaves an amount equal to the payment which would have been due if no Tax Deduction had been required.
|
(b) |
If an Obligor is required to make a Tax Deduction, that Obligor shall make that Tax Deduction and any payment required in connection with that Tax Deduction within the time allowed and in the minimum amount required by law.
|
(c) |
Within 30 days of making either a Tax Deduction or any payment required in connection with that Tax Deduction, the Obligor making that Tax Deduction shall deliver to the Agent for the Creditor Party entitled to the payment evidence reasonably satisfactory to that Creditor Party that the Tax Deduction has been made or (as applicable) any appropriate payment paid to the relevant taxing authority.
|
22.4 |
Tax Credit
|
(a) |
a Tax Credit is attributable (i) to an increased payment of which that Tax Payment forms part, (ii) to that Tax Payment, or (iii) to a Tax Deduction in consequence of which that Tax Payment was received; and
|
(b) |
that Creditor Party has obtained, utilised and retained that Tax Credit,
|
22.5 |
Application to Master Agreement
|
22.6 |
FATCA Information
|
(a) |
Subject to paragraph (c) below, each Party shall, within ten Business Days of a reasonable request by another Party:
|
(i) |
confirm to that other Party whether it is:
|
(A) |
a FATCA Exempt Party; or
|
(B) |
not a FATCA Exempt Party;
|
(ii) |
supply to that other Party such forms, documentation and other information relating to its status under FATCA (including US Internal Revenue Service Forms W-8 or W-9) as that other Party reasonably requests for the purposes of that other Party's compliance with FATCA; and (iii)supply to that other Party such forms, documentation and other information relating to its status as that other Party reasonably requests for the purposes of that other Party's compliance with any other law, regulation, or exchange of information regime.
|
(b) |
If a Party confirms to another Party pursuant to paragraph (a)(i) above that it is a FATCA Exempt Party or provides a US Internal Revenue Service Form W-8 or W-9, and it subsequently becomes aware that it is not or has ceased to be a FATCA Exempt Party or that such Form has ceased to be accurate or valid, that Party shall notify that other Party reasonably promptly or provide a revised Form, as applicable.
|
(c) |
Paragraph (a) above shall not oblige any Creditor Party to do anything, and paragraph (a)(iii) above shall not oblige any other Party to do anything, which would or might in its reasonable opinion constitute a breach of:
|
(i) |
any law or regulation;
|
(ii) |
any fiduciary duty; or
|
(iii) |
any duty of confidentiality;
|
(d) |
If a Party fails to confirm whether or not it is a FATCA Exempt Party or to supply forms, documentation or other information requested in accordance with paragraph (a)(i) or (ii) above (including, for the avoidance of doubt, where paragraph (c) above applies), then such Party shall be treated for the purposes of the Finance Documents (and payments under them) as if it is not a FATCA Exempt Party until such time as the Party in question provides the requested confirmation, forms, documentation or other information.
|
22.7 |
FATCA Deduction
|
(a) |
Each Party may make any FATCA Deduction it is required to make by FATCA, and any payment required in connection with that FATCA Deduction, and no Party shall be required to increase any payment in respect of which it makes such a FATCA Deduction or otherwise compensate the recipient of the payment for that FATCA Deduction.
|
(b) |
Each Party shall promptly, upon becoming aware that it must make a FATCA Deduction (or that there is any change in the rate or the basis of such FATCA Deduction), notify the Party to whom it is making the payment and, in addition, shall notify the Borrower and the Agent and the Agent shall notify the other Creditor Parties.
|
(c) |
If a FATCA Deduction is made as a result of any Creditor Party failing to be a FATCA Exempt Party, such party shall indemnify each other Creditor Party against any loss, cost or expense to it resulting from such FATCA Deduction.
|
23.1 |
Illegality
|
(a) |
unlawful or prohibited as a result of the introduction of a new law, an amendment to an existing law or a change in the manner in which an existing law is or will be interpreted or applied; or
|
(b) |
contrary to, or inconsistent with, any regulation, for the Notifying Lender to maintain or give effect to any of its obligations under this Agreement in the manner contemplated by this Agreement.
|
23.2 |
Notification of illegality
|
23.3 |
Prepayment; termination of Commitment
|
23.4 |
Mitigation
|
(a) |
have an adverse effect on its business, operations or financial condition; or
|
(b) |
involve it in any activity which is unlawful or prohibited or any activity that is contrary to, or inconsistent with, any regulation; or
|
(c) |
involve it in any expense (unless indemnified to its satisfaction) or tax disadvantage.
|
24.1 |
Increased costs
|
(a) |
the introduction or alteration after the date of this Agreement of a law or an alteration after the date of this Agreement in the manner in which a law is interpreted or applied (disregarding any effect which relates to the application to payments under this Agreement of a tax on the Notifying Lender's overall net income); or
|
(b) |
complying with any law or regulation (including any which relates to capital adequacy or liquidity controls or which affects the manner in which the Notifying Lender allocates capital resources to its obligations under this Agreement) which is introduced, or altered, or the interpretation or application of which is altered, after the date of this Agreement, the Notifying Lender (or a parent company of it) has incurred or will incur an "
increased cost
"
.
|
24.2 |
Meaning of
"
increased cost
"
|
(a) |
an additional or increased cost incurred as a result of, or in connection with, the Notifying Lender having entered into, or being a party to, this Agreement or a Transfer Certificate, of funding or maintaining its Commitment or Contribution or performing its obligations under this Agreement, or of having outstanding all or any part of its Contribution or other unpaid sums;
|
(b) |
a reduction in the amount of any payment to the Notifying Lender under this Agreement or in the effective return which such a payment represents to the Notifying Lender or on its capital;
|
(c) |
an additional or increased cost of funding all or maintaining all or any of the Tranches comprised in a class of advances formed by or including the Notifying Lender's Contribution or (as the case may require) the proportion of that cost attributable to the Contribution; or
|
(d) |
a liability to make a payment, or a return foregone, which is calculated by reference to any amounts received or receivable by the Notifying Lender under this Agreement,
|
24.3 |
Notification to Borrower of claim for increased costs
|
24.4 |
Payment of increased costs
|
24.5 |
Notice of prepayment
|
24.6 |
Prepayment; termination of Commitment
|
(a) |
on the date on which the Agent serves that notice, the Commitment of the Notifying Lender shall be cancelled; and
|
(b) |
on the date specified in its notice of intended prepayment, the Borrower shall prepay (without premium or penalty) the Notifying Lender's Contribution, together with accrued interest thereon at the applicable rate plus the Margin and the Mandatory Cost (if any).
|
24.7 |
Application of prepayment
|
25.1 |
Application of credit balances
|
(a) |
apply any balance (whether or not then due) which at any time stands to the credit of any account in the name of the Borrower at any office in any country of that Creditor Party in or towards satisfaction of any sum then due from the Borrower to that Creditor Party under any of the Finance Documents; and
|
(b) |
for that purpose:
|
(i) |
break, or alter the maturity of, all or any part of a deposit of the Borrower;
|
(ii) |
convert or translate all or any part of a deposit or other credit balance into Dollars; and
|
(iii) |
enter into any other transaction or make any entry with regard to the credit balance which the Creditor Party concerned considers appropriate.
|
25.2 |
Existing rights unaffected
|
25.3 |
Sums deemed due to a Lender
|
25.4 |
No Security Interest
|
26.1 |
Transfer by Borrower
|
26.2 |
Transfer by a Lender
|
(a) |
its rights in respect of all or part of its Contribution; or
|
(b) |
its obligations in respect of all or part of its Commitment; or
|
(c) |
a combination of (a) and (b),
|
26.3 |
Transfer Certificate, delivery and notification
|
(a) |
sign the Transfer Certificate on behalf of itself, the Borrower, the Security Parties, the Security Trustee and each of the other Lenders and the Swap Bank;
|
(b) |
on behalf of the Transferee Lender, send to the Borrower and each Security Party letters or faxes notifying them of the Transfer Certificate and attaching a copy of it; and
|
(c) |
send to the Transferee Lender copies of the letters or faxes sent under paragraph (b)
above,
|
26.4 |
Effective Date of Transfer Certificate
|
26.5 |
No transfer without Transfer Certificate
|
26.6 |
Lender re-organisation; waiver of Transfer Certificate
|
26.7 |
Effect of Transfer Certificate
|
(a) |
to the extent specified in the Transfer Certificate, all rights and interests (present, future or contingent) which the Transferor Lender has under or by virtue of the Finance Documents are assigned to the Transferee Lender absolutely, free of any defects in the Transferor Lender's title and of any rights or equities which the Borrower or any Security Party had against the Transferor Lender;
|
(b) |
the Transferor Lender's Commitment is discharged to the extent specified in the Transfer Certificate;
|
(c) |
the Transferee Lender becomes a Lender with the Contribution previously held by the Transferor Lender and a Commitment of an amount specified in the Transfer Certificate;
|
(d) |
the Transferee Lender becomes bound by all the provisions of the Finance Documents which are applicable to the Lenders generally, including those about pro-rata sharing and the exclusion of liability on the part of, and the indemnification of, the Agent and the Security Trustee and, to the extent that the Transferee Lender becomes bound by those provisions (other than those relating to exclusion of liability), the Transferor Lender ceases to be bound by them;
|
(e) |
any part of the Loan which the Transferee Lender advances after the Transfer Certificate's effective date ranks in point of priority and security in the same way as it would have ranked had it been advanced by the transferor, assuming that any defects in the transferor's title and any rights or equities of the Borrower or any Security Party against the Transferor Lender had not existed;
|
(f) |
the Transferee Lender becomes entitled to all the rights under the Finance Documents which are applicable to the Lenders generally, including but not limited to those relating to the Majority Lenders and those under Clause
Error! Reference source not found.
and Clause 20, and to the extent that the Transferee Lender becomes entitled to such rights, the Transferor Lender ceases to be entitled to them; and
|
(g) |
in respect of any breach of a warranty, undertaking, condition or other provision of a Finance Document or any misrepresentation made in or in connection with a Finance Document, the Transferee Lender shall be entitled to recover damages by reference to the loss incurred by it as a result of the breach or misrepresentation, irrespective of whether the original Lender would have incurred a loss of that kind or amount.
|
26.8 |
Maintenance of register of Lenders
|
26.9 |
Reliance on register of Lenders
|
26.10 |
Authorisation of Agent to sign Transfer Certificates
|
26.11 |
Registration fee
|
26.12 |
Sub-participation; subrogation assignment
|
26.13 |
Disclosure of information
|
26.14 |
Change of lending office
|
(a) |
the date on which the Agent receives the notice; and
|
(b) |
the date, if any, specified in the notice as the date on which the change will come into effect.
26.15 Notification
|
26.15 |
Replacement of Reference Bank
|
26.16 |
Security over Lenders' rights
|
(a) |
any charge, assignment or other Security Interest to secure obligations to a federal reserve or central bank; and
|
(b) |
in the case of any Lender which is a fund, any charge, assignment or other Security Interest granted to any holders (or trustee or representatives of holders) of obligations owed, or securities issued, by that Lender as security for those obligations or securities;
|
(i) |
substitute the beneficiary of the relevant charge, assignment or Security Interest for release a Lender from any of its obligations under the Finance Documents or the Lender as a party to any of the Finance Documents; or
|
(ii) |
require any payments to be made by the Borrower or any Security Party or grant to any person any more extensive rights than those required to be made or granted to the relevant Lender under the Finance Documents.
|
27.1 |
Variations, waivers etc. by Majority Lenders
|
27.2 |
Variations, waivers etc. requiring agreement of all Lenders
|
(a) |
a reduction in the Margin;
|
(b) |
a postponement to the date for, or a reduction in the amount of, any payment of principal, interest, fees or other sum payable under this Agreement;
|
(c) |
an increase in any Lender's Commitment;
|
(d) |
a change to the definition of "
Majority Lenders
"
;
|
(e) |
a change to Clause 3 or this Clause 27;
|
(f) |
any release of, or material variation to, a Security Interest, guarantee, indemnity or subordination arrangement set out in a Finance Document; and
|
(g) |
any other change or matter as regards which this Agreement or another Finance Document expressly provides that each Lender's consent is required.
|
27.3 |
Exclusion of other or implied variations
|
(a) |
a provision of this Agreement or another Finance Document; or
|
(b) |
an Event of Default; or
|
(c) |
a breach by the Borrower or a Security Party of an obligation under a Finance Document or the general law; or
|
(d) |
any right or remedy conferred by any Finance Document or by the general law, and there shall not be implied into any Finance Document any term or condition requiring any such provision to be enforced, or such right or remedy to be exercised, within a certain or reasonable time.
|
28.1 |
General
|
28.2 |
Addresses for communications
|
(a)
|
to the Borrower:
|
c/o Approved Manager
16 Pantelis Street
175 64 Palaio Faliro
Athens
Greece
Fax No.: +30 210 94 70 101
Attn:
|
(b)
|
to a Lender:
|
At the address below its name in Schedule 1 or (as the case may require) in the relevant Transfer Certificate.
|
(c)
|
to a Mandated Lead Arranger:
|
DNB Bank ASA
8
th
Floor, The Walbrook Building
25 Walbrook
London EC4N 8AF
England
Fax No: +44 207 283 5935
Attn: Credit Middle Office & Agency
Email:
cmoalondon@DNB.no
|
(d)
|
to the Agent and the
Security Trustee
|
DNB Bank ASA
8
th
Floor, The Walbrook Building
25 Walbrook
London EC4N 8AF
England
Fax No: +44 207 283 5935
Attn: Credit Middle Office & Agency
Email:
cmoalondon@DNB.no
|
(e)
|
DNB Bank ASA Security Trustee
|
DNB Bank ASA
8
th
Floor, The Walbrook Building
25
Walbrook
|
London EC4N 8AF
England
Fax No: +44 207 283 5935
Attn: Shipping Offshore & Logistics
|
||
(f)
|
to the Swap Bank:
|
DNB Bank ASA
8
th
Floor, The Walbrook Building
25 Walbrook
London EC4N 8AF
England
Fax No: +44 207 283 5935
Attn: Shipping Offshore & Logistics
|
28.3 |
Effective date of notices
|
(a) |
a notice which is delivered personally or posted shall be deemed to be served, and shall take effect, at the time when it is delivered; and
|
(b) |
a notice which is sent by fax shall be deemed to be served, and shall take effect, 2 hours after its transmission is completed.
|
28.4 |
Service outside business hours
|
(a) |
on a day which is not a business day in the place of receipt; or
|
(b) |
on such a business day, but after 5 p.m. local time, the notice shall (subject to Clause 28.5) be deemed to be served, and shall take effect, at 9 a.m. on the next day which is such a business day.
|
28.5 |
Illegible notices
|
28.6 |
Valid notices
|
(a) |
the failure to serve it in accordance with the requirements of this Agreement or other Finance Document, as the case may be, has not caused any party to suffer any significant loss or prejudice; or
|
(b) |
in the case of incorrect and/or incomplete contents, it should have been reasonably clear to the party on which the notice was served what the correct or missing particulars should have been.
|
28.7 |
Electronic communication
|
(a) |
agree that, unless and until notified to the contrary, this is to be an accepted form of communication;
|
(b) |
notify each other in writing of their electronic mail address and/or any other information required to enable the sending and receipt of information by that means; and
|
(c) |
notify each other of any change to their respective addresses or any other such information supplied to them.
|
28.8 |
English language
|
28.9 |
Meaning of
"
notice
"
|
29.1 |
Rights cumulative, non-exclusive
|
(a) |
cumulative;
|
(b) |
may be exercised as often as appears expedient; and
|
(c) |
shall not, unless a Finance Document explicitly and specifically states so, be taken to exclude or limit any right or remedy conferred by any law.
|
29.2 |
Severability of provisions
|
29.3 |
Counterparts
|
29.4 |
Third party rights
|
30.1 |
English law
|
30.2 |
Exclusive English jurisdiction
|
30.3 |
Choice of forum for the exclusive benefit of Creditor Parties
|
(a) |
to commence proceedings in relation to any Dispute in the courts of any country other than England and which have or claim jurisdiction to that Dispute; and
|
(b) |
to commence such proceedings in the courts of any such country or countries concurrently with or in addition to proceedings in England or without commencing proceedings in England.
|
30.4 |
Process agent
|
30.5 |
Creditor Party rights unaffected
|
30.6 |
Meaning of
"
proceedings
"
and
"
Dispute
"
|
Lender
|
Lending Office
|
Commitment
(US Dollars) |
DNB (UK) Limited
|
8
th
Floor
The Walbrook Building
25
Walbrook
London
England
|
4,053,000
|
The Export-Import Bank of
China
|
Transport Finance Dept.
The Export-Import Bank of China
No. 30 Fu Xing Men Nei Street
Xicheng District
Beijing
China
|
9,457,000
|
To: |
DNB Bank ASA
8 th Floor The Walbrook Building 25 Walbrook London England |
1 |
We refer to the loan agreement (the
"
Loan Agreement
"
) dated [•] 2016 and made between (i) ourselves, as Borrower, (ii) the Lenders referred to therein, (ii) DNB Bank ASA and the Export-Import Bank of China as Mandated Lead Arrangers, (iv) DNB Bank ASA as Swap Bank and (v) DNB Bank ASA as Agent and as Security Trustee in connection with a loan facility of US$13,510,000. Terms defined in the Loan Agreement have their defined meanings when used in this Drawdown Notice.
|
2 |
We request to borrow the Loan as follows:
|
(a) |
Amount: US$13,510,000;
|
(b) |
Drawdown Date: [ ];
|
(c) |
Duration of the first Interest Period shall be [ ] months;
|
(d) |
Payment instructions : account of [ ] and numbered [ ] with [ ] of [ ].
|
3 |
We represent and warrant that:
|
(a) |
the representations and warranties in Clause 10 of the Loan Agreement would remain true and not misleading if repeated on the date of this notice with reference to the circumstances now existing; and
|
(b) |
no Event of Default or Potential Event of Default has occurred or will result from the borrowing of the Loan.
|
4. |
This notice cannot be revoked without the prior consent of the Majority Lenders.
|
1 |
A duly executed original of this Agreement, the Corporate Guarantee, the Agency and Trust Agreement, the Master Agreement, the Account Pledge, the Shares Pledge and the Master Agreement Assignment (and of each document required to be delivered under each of those Finance Documents).
|
2 |
Copies of the certificate of incorporation and constitutional documents of the Borrower and each Security Party.
|
3 |
Copies of resolutions of the shareholders and directors of the Borrower and each Security Party (other than the Corporate Guarantor) authorising the execution of each of the Finance Documents to which the Borrower or that Security Party is a party and, in the case of the Borrower, authorising named officers and attorneys to give the Drawdown Notice and other notices under this Agreement.
|
4 |
Copies of resolutions of the executive committee of the Corporate Guarantor authorising the execution of each of the Finance Documents to which it is a party.
|
5 |
The original of any power of attorney under which any Finance Document is executed on behalf of the Borrower or any Security Party.
|
6 |
Copies of all consents which the Borrower or any Security Party requires to enter into, or make any payment under, any Finance Document.
|
7 |
The originals of any mandates or other documents required in connection with the opening or operation of the Earnings Account.
|
8 |
Favourable legal opinions from lawyers appointed by the Agent on such matters concerning the laws of Marshall Islands, England and such other relevant jurisdiction as the Agent may require.
|
9 |
Satisfactory completion of each Lender's compliance and due diligence requirements in connection with the
"
know your customer
"
process or similar identification procedures in relation to the transactions contemplated by the Finance Documents.
|
10 |
Evidence that the agent for service of process named in Clause 30 has accepted its appointment.
|
11 |
If the Agent so requires, in respect of any of the documents referred to above, a certified English translation prepared by a translator approved by the Agent.
|
1 |
A duly executed original of the Mortgage and the General Assignment (and of each document to be delivered under each of them).
|
(a) |
the Ship is definitively and permanently registered in the name of the Borrower under an Approved Flag State;
|
(b) |
the Ship is in the absolute and unencumbered ownership of the Borrower save as contemplated by the Finance Documents;
|
(c) |
the Ship maintains the highest available class with Bureau of Veritas free of all overdue recommendations and conditions of such Classification Society;
|
(d) |
the Mortgage has been duly registered against the Ship as a valid first preferred or, as the case may be, priority ship mortgage in accordance with the laws of the relevant Approved Flag State; and
|
(e) |
the Ship is insured in accordance with the provisions of this Agreement and all requirements therein in respect of insurances have been complied with;
|
3 |
Documents establishing that the Ship will, as from the Drawdown Date, be managed by the Approved Manager on terms acceptable to the Lenders, together with:
|
(a) |
the Approved Manager's Undertaking;
|
(b) |
copies of the Approved Manager's document of compliance (DOC) and the safety management certificate (SMC) in respect of the Ship referred to in paragraph (a) of the definition of the ISM Code Documentation certified as true and in effect by the Borrower and the Approved Manager; and
|
(c) |
a copy of the International Ship Security Certificate in respect of the Ship certified as true and in effect by the Borrower and the Approved Manager.
|
4 |
A favourable opinion from an independent insurance consultant acceptable to and appointed by the Agent on such matters relating to the insurances for the Ship as the Agent may require.
|
5 |
Evidence satisfactory to the Agent that the Minimum Liquidity Amount is standing to the credit of the Earnings Account pursuant to Clause 11.20.
|
6 |
Favourable legal opinions from lawyers appointed by the Agent on such matters concerning the laws of the Approved Flag State and such other relevant jurisdictions as the Lender may require.
|
7 |
If the Agent so requires, in respect of any of the documents referred to above, a certified English translation prepared by a translator approved by the Agent.
|
To: |
DNB Bank ASA for itself and for and on behalf of the Borrower, each Security Party, the Security Trustee and each Lender and the Swap Bank, as defined in the Loan Agreement referred to below.
|
1 |
This Certificate relates to a Loan Agreement (the
"
Loan Agreement
"
) dated [•] May 2016 and made between (1) Wake Shipping Company Inc. (the
"
Borrower
"
), (2) the banks and financial institutions named therein as Lenders, (3) DNB Bank ASA and The Export-Import Bank of China as Mandated Lead Arranger and (4) DNB Bank ASA as Agent, as Security Trustee and as Swap Bank, for a loan facility of US$13,510,000.
|
2 |
In this Certificate, terms defined in the Loan Agreement shall, unless the contrary intention appears, have the same meanings when used in this Certificate and:
|
3 |
The effective date of this Certificate is [•] Provided that this Certificate shall not come into effect unless it is signed by the Agent on or before that date.
|
4 |
The Transferor assigns to the Transferee absolutely all rights and interests (present, future or contingent) which the Transferor has as Lender under or by virtue of the Loan Agreement and every other Finance Document (other than the Master Agreement) in relation to [•] per cent. of its Contribution, which percentage represents $[•].
|
5 |
By virtue of this Certificate and Clause 26 of the Loan Agreement, the Transferor is discharged entirely from its Commitment which amounts to $[•]] [from [•] per cent. of its Commitment, which percentage represents $[•]] and the Transferee acquires a Commitment of $[•].
|
6 |
The Transferee undertakes with the Transferor and each of the Relevant Parties that the Transferee will observe and perform all the obligations under the Finance Documents (other than the Master Agreement) which Clause 26 of the Loan Agreement provides will become binding on it upon this Certificate taking effect.
|
7 |
The Agent, at the request of the Transferee (which request is hereby made) accepts, for the Agent itself and for and on behalf of every other Relevant Party, this Certificate as a Transfer Certificate taking effect in accordance with Clause 26 of the Loan Agreement.
|
8 |
The Transferor:
|
(a) |
warrants to the Transferee and each Relevant Party that:
|
(i) |
the Transferor has full capacity to enter into this transaction and has taken all corporate action and obtained all consents which are required in connection with this transaction; and
|
(ii) |
this Certificate is valid and binding as regards the Transferor;
|
(b) |
warrants to the Transferee that the Transferor is absolutely entitled, free of encumbrances, to all the rights and interests covered by the assignment in paragraph 4 above; and
|
(c) |
undertakes with the Transferee that the Transferor will, at its own expense, execute any documents which the Transferee reasonably requests for perfecting in any relevant jurisdiction the Transferee's title under this Certificate or for a similar purpose.
|
9 |
The Transferee
|
(a) |
confirms that it has received a copy of the Loan Agreement and each of the other Finance Documents;
|
(b) |
agrees that it will have no rights of recourse on any ground against either the Transferor, the Agent, the Security Trustee, either Mandated Lead Arranger, any Lender or the Swap Bank in the event that:
|
(i) |
any of the Finance Documents prove to be invalid or ineffective,
|
(ii) |
the Borrower or any Security Party fails to observe or perform its obligations, or to discharge its liabilities, under any of the Finance Documents;
|
(iii) |
it proves impossible to realise any asset covered by a Security Interest created by a Finance Document, or the proceeds of such assets are insufficient to discharge the liabilities of the Borrower or any Security Party under any of the Finance Documents;
|
(c) |
agrees that it will have no rights of recourse on any ground against the Agent, the Security Trustee, either Mandated lead Arranger, any Lender or the Swap Bank in the event that this Certificate proves to be invalid or ineffective;
|
(d) |
warrants to the Transferor and each Relevant Party that:
|
(i) |
it has full capacity to enter into this transaction and has taken all corporate action and obtained all consents which it needs to take or obtain in connection with this transaction; and
|
(ii) |
that this Certificate is valid and binding as regards the Transferee; and
|
(e) |
confirms the accuracy of the administrative details set out below regarding the Transferee
|
10 |
The Transferor and the Transferee each undertake with the Agent, the Mandated Lead Arrangers and the Security Trustee severally, on demand, fully to indemnify the Agent and/or the Mandated Lead Arrangers the Security Trustee in respect of any claim, proceeding, liability or expense (including all legal expenses) which they or any of them may incur in connection with this Certificate or any matter arising out of it, except such as are shown to have been mainly and directly caused by the gross and culpable negligence or dishonesty of the Agent's, the Mandated Lead Arrangers or the Security Trustee's own officers or employees.
|
11 |
The Transferee shall repay to the Transferor on demand so much of any sum paid by the Transferor under paragraph 10 above as exceeds one-half of the amount demanded by the Agent or the Security Trustee in respect of a claim, proceeding, liability or expense which was not reasonably foreseeable at the date of this Certificate; but nothing in this paragraph
|
[Name of Transferor]
By:
Date:
Agent
Signed for itself and for and on behalf of itself
as Agent and for every other Relevant Party
DNB Bank ASA
By:
Date:
|
[Name of Transferee]
By:
Date:
|
Note:
|
This Transfer Certificate alone may not be sufficient to transfer a proportionate share of the Transferor's interest in the security constituted by the Finance Documents in the Transferor's or Transferee's jurisdiction. It is the responsibility of each Lender to ascertain whether any other documents are required for this purpose.
|
BORROWER
|
|||
SIGNED
by
|
)
|
||
Margarita Veniou
|
)
|
/s/ Margarita Veniou
|
|
for and on behalf of
|
)
|
||
WAKE SHIPPING COMPANY INC.
|
)
|
||
in the presence of:
|
)
|
/s/ Artemis Danousi
|
|
LENDERS
|
|||
SIGNED
by:
|
)
|
||
David Hopwood
|
)
|
/s/ David Hopwood
|
|
for and on behalf of
|
)
|
||
DNB (UK) LIMITED
|
)
|
||
in the presence of:
|
)
|
/s/ Michael Rufian
|
|
SIGNED
by
|
)
|
||
) /s/
|
|
||
for and on behalf of
|
)
|
||
THE EXPORT-IMPORT BANK OF CHINA
|
)
|
||
in the presence of:
|
)
|
|
|
/s/ | |||
AGENT
|
|||
SIGNED
by
|
)
|
||
Kelina Kantzou
|
)
|
/s/ Kelina Kantzou
|
|
for and on behalf of
|
)
|
||
DNB BANK ASA
|
)
|
||
in the presence of:
|
)
|
/s/ Artemis Danousi
|
|
SECURITY TRUSTEE
|
|||
SIGNED
by
|
)
|
||
Kelina Kantzou
|
)
|
/s/ Kelina Kantzou
|
|
for and on behalf of
|
)
|
||
ABN AMRO BANK N.V.
|
)
|
||
in the presence of:
|
)
|
/s/ Artemis Danousi
|
|
SWAP BANK
|
|||
SIGNED
by
|
)
|
||
Kelina Kantzou
|
)
|
/s/ Kelina Kantzou
|
|
for and on behalf of
|
)
|
||
DNB BANK ASA
|
)
|
||
in the presence of:
|
)
|
/s/ Artemis Danousi
|
|
MANDATED LEAD ARRANGERS
|
|||
SIGNED
by:
|
)
|
||
Kelina Kantzou
|
)
|
/s/ Kelina Kantzou
|
|
for and on behalf of
|
)
|
||
DNB BANK ASA
|
)
|
||
in the presence of:
|
)
|
/s/ Artemis Danousi
|
|
SIGNED
by:
|
)
|
||
|
) /s/
|
|
|
for and on behalf of
|
)
|
||
THE EXPORT-IMPORT BANK OF CHINA
|
)
|
||
in the presence of:
|
)
|
|
|
/s/ |
(1) |
DIANA SHIPPING INC., a corporation incorporated under the laws of The Republic of the Marshall Islands whose registered office is at Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, Marshall Islands MH 96960 (the
"Lender"),
as lender;
|
(2) |
ELUK SHIPPING COMPANY INC., a corporation incorporated under the laws of The Republic of the Marshall Islands whose registered office is at Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, Marshall Islands MH 96960 and any wholly-owned subsidiary of the Guarantor that becomes an Additional Borrower pursuant to Section 12 hereof (each a
"Borrower",
collectively the "Borrowers"), as borrowers; and
|
(3) |
DIANA CONTAINERSHIPS INC., a corporation incorporated under the laws of The Republic of the Marshall Islands whose registered office is at Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, Marshall Islands MH 96960 (the
"Guarantor"),
as guarantor.
|
(A) |
The term "calendar year" in Section 6.2 of the Loan Agreement is deleted and replaced with the term "12-month period" such that, as so amended, Section 6.2 of the Loan Agreement in its entirety reads as follows:
|
6.2 |
Repayment Installments.
The Borrowers jointly and severally agree to repay the principal amount of the Loan in equal installments on the last day of each Interest Period (excluding the Repayment Date) in amounts totaling $5,000,000 per 12-month period, provided that the amount to be repaid pursuant to this Section 6.2 shall not exceed $32,500
,
000 in the aggregate.
|
(B) |
Confirmation of Agreement
.
Except as expressly set forth herein, the Agreement is ratified and confirmed in all respects and shall remain in full force and effect in accordance with its terms, and each reference in the Agreement to "this Agreement" shall mean the Agreement as amended by this Amendment.
|
(C) |
Counterparts; Effectiveness
. This Amendment may be executed in any number of counterparts (including by facsimile) and by different parties hereto in separate counterparts, with the same effect as if all parties had signed the same document. All such counterparts shall be deemed an original, shall be construed together and shall constitute one and the same instrument. This Amendment shall become effective when each party hereto shall have received counterparts hereof signed by all of the other parties hereto.
|
(D) |
Governing Law
. The laws of the State of New York shall govern the enforceability and validity of this Agreement, the construction of its terms and the interpretation of the rights and duties of the parties, without regard to the principles of conflicts of laws thereof.
|
SIGNED
by
Margarita Veniou for and on behalf of Eluk Shipping
Company
Inc.
in the presence of: |
)
) /s/ Margarita Veniou ) ) ) /s/ Ioannis Zafirakis |
SIGNED
by
Anastasios Margaronis for and on behalf of Diana Containerships
Inc
.
in the presence of: |
)
) /s/ Anastasios Margaronis ) ) ) /s/ Ioannis Zafirakis |
SIGNED
by
Ioannis Zafirakis for and on behalf of Diana Shipping Inc. in the presence of: |
)
) /s/ Ioannis Zafirakis ) ) ) s/ Margarita Veniou |
September 12, 2016
|
||
FOURTH AMENDMENT TO
|
||
LOAN AGREEMENT
|
||
relating to an unsecured term loan facility
of up to US$50,000,000 to be used for general corporate purposes and working capital requirements |
||
by and between
DIANA SHIPPING INC.
as Lender
-and-
ELUK SHIPPING COMPANY INC.
as Outgoing Borrower
-and-
KAPA SHIPPING COMPANY INC.
as New Borrower
- and-
DIANA CONTAINERSHIPS INC.
as Guarantor |
||
(1) |
DIANA SHIPPING INC., a corporation incorporated under the laws of The Republic of the Marshall Islands whose registered office is at Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, Marshall Islands MH 96960 (the
"Lender"),
as lender;
|
(2) |
ELUK SHIPPING COMPANY INC., a corporation incorporated under the laws of The Republic of the Marshall Islands whose registered office is at Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, Marshall Islands MH 96960, as outgoing borrower (the
"Outgoing Borrower");
|
(3) |
KAPA SHIPPING COMPANY INC., a corporation incorporated under the laws of The Republic of the Marshall Islands whose registered office is at Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, Marshall Islands MH 96960 and any wholly-owned subsidiary of the Guarantor that becomes an Additional Borrower pursuant to Section 12 of the Principal Loan Agreement (each a
"New Borrower",
collectively the
"New Borrowers"),
as new borrowers; and
|
(4) |
DIANA CONTAINERSHIPS INC., a corporation incorporated under the laws of The Republic of the Marshall Islands whose registered office is at Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, Marshall Islands MH 96960 (the
"Guarantor"),
as guarantor.
|
(A) |
Novation.
With effect from the date of this Amendment, the New Borrower assumes and undertakes to perform all the obligations, duties and liabilities of the Outgoing Borrower under the Principal Loan Agreement as amended by this Amendment and as same may be further amended and/or supplemented in the future (the
"Loan Agreement")
and shall be bound by the terms and provisions of the Loan Agreement to the same extent and in the same manner as if it had been a party thereto as a borrower and the New Borrower shall be, and is hereby made, party to the Loan Agreement in substitution for the Outgoing Borrower, and the Loan Agreement shall henceforth be construed and treated in all respects
|
(B) |
The definition of "Margin" in Section 1.1 of the Principal Loan Agreement is hereby deleted in its entirety and replaced with the following:
|
(C) |
A new Section 6.4 is hereby added in the Principal Loan Agreement reading as follows:
|
6.4 |
Notwithstanding anything else contained in this Section 6, there shall be no repayments of the principal amount of the Loan prior to the date that is the later of: (i) 15 September 2018 and (ii) the date when the Deferred Tranche (as defined in the RBS Loan Facility) under the $148,000,000 secured loan agreement with The Royal Bank of Scotland plc dated 10 September 2015 (the
"Original RBS Loan Facility")
entered into by, amongst others, the Guarantor as guarantor and certain of its subsidiaries as borrowers (the
"RBS Borrowers")
as amended and restated pursuant to an amendment agreement dated 12 September 2016 (the
"RBS Amendment Agreement"
and together with the Original RBS Loan Facility, the
"RBS Loan Facility"),
has been repaid or prepaid in full.
|
(D) |
Subordination of Loan Agreement.
The amounts due to the Lender under the Loan Agreement are subordinated to the Indebtedness (as defined in the RBS Loan Facility) on the terms and subject to the conditions contained in an intercreditor agreement made or to be made between, amongst others, the New Borrower, the Guarantor, the Lender and The Royal Bank of Scotland plc as agent.
|
(E) |
Consent.
The Lenders consent to the RBS Borrowers entering into the RBS Amendment Agreement.
|
(F) |
Confirmation of Agreement.
Except as expressly set forth herein, the Principal Loan Agreement is ratified and confirmed in all respects and shall remain in full force and effect in accordance with its terms, and each reference in the Principal Loan Agreement to "this Agreement" shall mean the Principal Loan Agreement as amended by this Amendment.
|
(G) |
Counterparts; Effectiveness.
This Amendment may be executed in any number of counterparts (including by facsimile) and by different parties hereto in separate counterparts, with the same effect as if all parties had signed the same document.
|
(H) |
Governing Law.
The laws of the State of New York shall govern the enforceability and validity of this Amendment, the construction of its terms and the interpretation of the rights and duties of the parties, without regard to the principles of conflicts of laws thereof
|
OUTGOING
BORROWER |
||
SIGNED
by
|
)
|
|
Margarita Veniou
|
)
|
/s/ Margarita Veniou
|
for and on behalf of
|
)
|
|
Eluk Shipping Company Inc.
|
)
|
|
in the presence of:
|
)
|
|
/s/ Alexandra Markou
|
||
NEW
BORROWER |
||
SIGNED
by
|
)
|
|
Anastasios Margaronis
|
)
|
/s/ Anastasios Margaronis
|
for and on behalf of
|
)
|
|
Kapa Shipping
Company Inc. |
)
|
|
in the presence of:
|
)
|
|
/s/ Margarita Veniou
|
||
GUARANTOR
|
||
SIGNED
by:
|
)
|
|
Anastasios Margaronis
|
)
|
/s/ Anastasios Margaronis
|
for and on behalf of
|
)
|
|
Diana Containerships Inc.
|
)
|
|
in the presence of:
|
)
|
|
/s/ Margarita Veniou
|
||
LENDER
|
||
SIGNED
by
|
)
|
|
Simeon Palios
|
)
|
/s/ Simeon Palios
|
for and on behalf of
|
)
|
|
Diana Shipping Inc.
|
)
|
|
in the presence of:
|
)
|
|
/s/ Margarita Veniou
|
Taka Shipping Company Inc
c/o Approved Manager
16 Pendelis Street
175 64 Paleo Faliro Athens Greece
Attn: Chief Financial Officer
Email: amichalopoulos@dianashippinginc.com
|
Fayo Shipping Company Inc
c/o Approved Manager
16 Pendelis Street
175 64 Paleo Faliro
Athens
Greece
Attn: Chief Financial Officer
Email: amichalopoulos@dianashippinginc.com
|
/s/ Simon Baker | |
For and on behalf of
Commonwealth Bank of Australia
|
/s/Andre-Nikolas Michalopoulos
|
/s/Ioannis Zafirakis
|
|
For and on behalf of
Taka Shipping Company Inc
Andre-Nikolas Michalopoulos
Director and Treasurer
|
For and on behalf of
Fayo Shipping Company Inc
Ioannis Zafirakis
Director and Treasurer
|
|
/s/Anastasios Margaronis
|
||
For and behalf of
Diana Shipping Inc. as the Guarantor
Anastasios Margaronis
Director and President
|
Taka Shipping Company Inc
c/o Approved Manager
16 Pendelis Street
175 64 Paleo Faliro Athens Greece
Attn: Chief Financial Officer
Email: amichalopoulos@dianashippinginc.com
|
Fayo Shipping Company Inc
c/o Approved Manager
16 Pendelis Street
175 64 Paleo Faliro
Athens
Greece
Attn: Chief Financial Officer
Email: amichalopoulos@dianashippinginc.com
|
/s/Simon Baker
|
|
Simon Baker
Director
For and on behalf of
Commonwealth Bank of Australia
|
/s/ S. Palios
|
/s/ S. Palios
|
|
S. Palios
Director and President
|
S. Palios
Director and President
|
|
/s/ A. Michalopoulos
|
/s/ I. Zafirakis
|
|
A. Michalopoulos
Director and Treasurer
|
I. Zafirakis
Director and Treasurer
|
|
For and on behalf of
Taka Shipping Company Inc
|
For and on behalf of
Fayo Shipping Company Inc
|
|
/s/ S. Palios
|
||
S. Palios
Director, Chief Executive
Officer & Chairman of the Board
|
||
/s/ A. Michalopoulos
|
||
Chief Financial Officer & Treasuer
|
1 |
Reference is made to the loan agreement dated 2 October 2010 (as amended and/or supplemented from time to time) (the
Loan Agreement)
and entered into between,
inter alios,
(1) Lae Shipping Company and Namu Shipping Company Inc. as joint and several borrowers (the
"Borrowers"),
(2) Diana Shipping Inc. as guarantor (the
"Corporate Guarantor"),
(3) DNB Bank ASA (then known as DnB NOR BANK ASA) and The Export-Import Bank of China as arrangers, (4) DNB Bank ASA (then known as DnB NOR BANK ASA) as swap provider, (5) DNB Bank ASA (then known as DnB NOR BANK ASA) as security agent (the
"Security Agent"),
agent (the
"Agent")
and account bank and (6) the banks and financial institutions referred to therein as lenders (the
"Banks"),
in relation to a loan of up to $82,600,000.
|
2 |
Words and expressions defined in the Loan Agreement shall, unless the context otherwise requires or unless otherwise defined herein, have the same meanings when used in this Agreement.
|
3 |
The Creditors hereby agree, following the Borrowers' request, that, with effect from the date of this Agreement, clause 4.1.5 of the Loan Agreement shall be amended (and is hereby amended) as follows:
|
"4.1.5 |
If one or more Banks wish to exercise their right under clause 4.1.3 in respect of an Advance, the Agent shall send to the Borrowers a written demand to this effect in respect of that Advance:
|
(a)
|
in respect of the Namu Advance, by not earlier than the date falling fifty four (54) months after the Drawdown Date for such Advance and by not later than the date falling sixty (60) months after the Drawdown Date for such Advance; or
|
(b)
|
in respect of the Lae Advance, at any time on or before 18 May 2017.
|
4 |
The consent of the Creditors referred to in paragraph 3 above is given only on the condition and in consideration of the Borrowers and the Corporate Guarantor hereby agreeing with the Creditors that the Borrowers and the other Security Parties will comply or will procure compliance with the following terms at the times specified below:
|
(a)
|
by no later than 15 February 2017, the Borrowers and the other Security Parties shall have executed this Agreement by signatories acceptable to the Agent in all respects;
|
(b)
|
by no later than 23 February 2017, the Borrowers and the other Security Parties deliver to the Agent, such corporate authorisations or other evidence of the authority of each Security Party, in relation to the execution of this Agreement, in such form as the Agent may require in its absolute discretion; and
|
(c)
|
by no later than 23 February 2017, each Borrower executes in favour of the Security Agent, in respect of its Ship, an addendum to the Mortgage of such Ship (each a
"Mortgage Addendum"
and together the
"Mortgage Addenda")
in form and substance satisfactory to the Agent and procures that each such Mortgage Addendum has been duly recorded with the relevant Registry of each such Ship.
|
5 |
Failure by the Borrowers and the other Security Parties to comply with any of the above conditions at the times specified above will constitute an Event of Default under the Loan Agreement.
|
6 |
This Agreement is supplemental to the Loan Agreement.
|
7 |
This Agreement constitutes a Security Document.
|
8 |
Save as amended or deemed amended by this Agreement, the provisions of the Loan Agreement shall continue in full force and effect and the Loan Agreement and this Agreement shall be read and construed as one instrument.
|
9 |
Each of the Borrowers, the Corporate Guarantor and the Manager hereby confirms its consent to the amendments to the Loan Agreement hereunder and the other arrangements contained in this Agreement, and further acknowledges and agrees that the Security Documents to which it is a party and its obligations, shall remain and continue to be in full force and effect notwithstanding the said amendments to the Loan Agreement and the other arrangements contained in this Agreement.
|
10 |
The provisions of clauses 17 (Notices) and 18 (Governing law and jurisdiction) of the Loan Agreement shall be incorporated into this Agreement as if set out in full herein and as if references to "this Agreement" were references to this Agreement.
|
11 |
This Agreement and any non-contractual obligations in connection with this Agreement are governed by, and shall be construed in accordance with English law.
|
EXECUTED
as a
DEED
|
)
|
|
By Anastasios Margaronis
|
)
|
|
for and on behalf of
|
)
|
/s/ Anastasios Margaronis
|
LAE SHIPPING COMPANY INC.
|
)
|
Authorised Signatory
|
as Borrower
|
)
|
Signed in Switzerland
|
in the presence of:
|
15 February 2017
|
|
/s/ Sophia Fafalios
|
||
Witness
|
||
Name: Sophia Fafalios
|
||
Address: 1 Haversham Place, Merton Lane, London N6 6NG, United Kingdom
|
||
Occupation: Shipbroker
|
||
EXECUTED
as a
DEED
|
)
|
|
By Anastasios Margaronis
|
)
|
|
for and on behalf of
|
)
|
/s/ Anastasios Margaronis
|
NAMU SHIPPING COMPANY INC.
|
)
|
Director and Secretary
|
as Borrower
|
)
|
Signed in Switzerland
|
in the presence of:
|
15 February 2017
|
|
/s/ Sophia Fafalios
|
||
Witness
|
||
Name: Sophia Fafalios
|
||
Address: 1 Haversham Place, Merton Lane, London N6 6NG, United Kingdom
|
||
Occupation: Shipbroker
|
||
EXECUTED
as a
DEED
|
)
|
|
By Anastasios Margaronis
|
)
|
|
for and on behalf of
|
)
|
/s/ Anastasios Margaronis
|
DIANA SHIPPING INC.
|
)
|
Director and President
|
as Corporate Guarantor
|
)
|
Signed in Switzerland
|
in the presence of:
|
15 February 2017
|
|
/s/ Sophia Fafalios
|
||
Witness
|
||
Name: Sophia Fafalios
|
||
Address: 1 Haversham Place, Merton Lane, London N6 6NG, United Kingdom
|
||
Occupation: Shipbroker
|
||
EXECUTED
as a
DEED
|
)
|
|
By Anastasios Margaronis
|
)
|
|
for and on behalf of
|
)
|
/s/ Anastasios Margaronis
|
DIANA SHIPPING SERVICES S.A.
|
)
|
Director and Secretary
|
as Manager
|
)
|
Signed in Switzerland
|
in the presence of:
|
15 February 2017
|
|
/s/ Sophia Fafalios
|
||
Witness
|
||
Name: Sophia Fafalios
|
||
Address: 1 Haversham Place, Merton Lane, London N6 6NG, United Kingdom
|
||
Occupation: Shipbroker
|
||
EXECUTED
as a
DEED
|
)
|
|
By David Hopwood and Ioannis Kariofyllidis
|
)
|
|
for and on behalf of
|
)
|
/s/ David Hopwood /s/ Ioannis Kariofyllidis
|
DNB (UK) LIMITED
|
)
|
Authorised Signatory
|
as Bank
|
)
|
|
in the presence of:
|
||
/s/ Vanessa Kerr
|
||
Witness
|
||
Name: Vanessa Kerr
|
||
Address: Norton Rose Fulbright LLP, 3 More London Riverside, London SE1 2AQ United Kingdom
|
||
Occupation: Legal Transaction Assistant
|
||
EXECUTED
as a
DEED
|
)
|
|
By David Hopwood and Ioannis Kariofyllidis
|
)
|
|
for and on behalf of
|
)
|
/s/ David Hopwood /s/ Ioannis Kariofyllidis
|
DNB BANK ASA (formerly known as DNB NOR BANK ASA)
|
)
|
Authorised Signatory
|
as Arranger
|
)
|
|
in the presence of:
|
||
/s/ Vanessa Kerr
|
||
Witness
|
||
Name: Vanessa Kerr
|
||
Address: Norton Rose Fulbright LLP, 3 More London Riverside, London SE1 2AQ United Kingdom
|
||
Occupation: Legal Transaction Assistant
|
||
EXECUTED
as a
DEED
|
)
|
|
By
|
)
|
|
for and on behalf of
|
) /s/ | |
THE EXPORT-IMPORT BANK OF CHINA
|
)
|
Authorised Signatory
|
as Manager
|
)
|
|
in the presence of:
|
/s/ Luo Weibo
|
||
Witness
|
||
Name: Luo Weibo
|
||
Address: No. 30, FuXingMenNei street, Xicheng District, Beijing 100031, P.R. China
|
||
Occupation: Project Manager
|
||
EXECUTED
as a
DEED
|
)
|
|
By David Hopwood and Ioannis Kariofyllidis
|
)
|
|
for and on behalf of
|
)
|
/s/ David Hopwood /s/ Ioannis Kariofyllidis
|
DNB BANK ASA (formerly known as DNB NOR BANK ASA)
|
)
|
Authorised Signatory
|
as Swap Provider
|
)
|
|
in the presence of:
|
||
/s/ Vanessa Kerr
|
||
Witness
|
||
Name: Vanessa Kerr
|
||
Address: Norton Rose Fulbright LLP, 3 More London Riverside, London SE1 2AQ United Kingdom
|
||
Occupation: Legal Transaction Assistant
|
||
EXECUTED
as a
DEED
|
)
|
|
By David Hopwood and Ioannis Kariofyllidis
|
)
|
|
for and on behalf of
|
)
|
/s/ David Hopwood /s/ Ioannis Kariofyllidis
|
DNB BANK ASA (formerly known as DNB NOR BANK ASA)
|
)
|
Authorised Signatory
|
as Security Agent
|
)
|
|
in the presence of:
|
||
/s/ Vanessa Kerr
|
||
Witness
|
||
Name: Vanessa Kerr
|
||
Address: Norton Rose Fulbright LLP, 3 More London Riverside, London SE1 2AQ United Kingdom
|
||
Occupation: Legal Transaction Assistant
|
||
EXECUTED
as a
DEED
|
)
|
|
By David Hopwood and Ioannis Kariofyllidis
|
)
|
|
for and on behalf of
|
)
|
/s/ David Hopwood /s/ Ioannis Kariofyllidis
|
DNB BANK ASA (formerly known as DNB NOR BANK ASA)
|
)
|
Authorised Signatory
|
as Agent
|
)
|
|
in the presence of:
|
||
/s/ Vanessa Kerr
|
||
Witness
|
||
Name: Vanessa Kerr
|
||
Address: Norton Rose Fulbright LLP, 3 More London Riverside, London SE1 2AQ United Kingdom
|
||
Occupation: Legal Transaction Assistant
|
||
EXECUTED
as a
DEED
|
)
|
|
By David Hopwood and Ioannis Kariofyllidis
|
)
|
|
for and on behalf of
|
)
|
/s/ David Hopwood /s/ Ioannis Kariofyllidis
|
DNB BANK ASA (formerly known as DNB NOR BANK ASA)
|
)
|
Authorised Signatory
|
as Account Bank
|
)
|
|
in the presence of:
|
||
/s/ Vanessa Kerr
|
||
Witness
|
||
Name: Vanessa Kerr
|
||
Address: Norton Rose Fulbright LLP, 3 More London Riverside, London SE1 2AQ United Kingdom
|
||
Occupation: Legal Transaction Assistant
|
||
Subsidiary
|
Country of Incorporation
|
Ailuk Shipping Company Inc.
|
Marshall Islands
|
Bikar Shipping Company Inc.
|
Marshall Islands
|
Bikini Shipping Company Inc.
|
Marshall Islands
|
Erikub Shipping Company Inc.
|
Marshall Islands
|
Gala Properties Inc.
|
Marshall Islands
|
Guam Shipping Company Inc.
|
Marshall Islands
|
Jaluit Shipping Company Inc.
|
Marshall Islands
|
Jemo Shipping Company Inc.
|
Marshall Islands
|
Kili Shipping Company Inc.
|
Marshall Islands
|
Knox Shipping Company Inc.
|
Marshall Islands
|
Lae Shipping Company Inc.
|
Marshall Islands
|
Lib Shipping Company Inc.
|
Marshall Islands
|
Mandaringina Inc.
|
Marshall Islands
|
Majuro Shipping Company Inc.
|
Marshall Islands
|
Namu Shipping Company Inc.
|
Marshall Islands
|
Palau Shipping Company Inc.
|
Marshall Islands
|
Taka Shipping Company Inc.
|
Marshall Islands
|
Tuvalu Shipping Company Inc.
|
Marshall Islands
|
Wotho Shipping Company Inc.
|
Marshall Islands
|
Aster Shipping Company Inc.
|
Marshall Islands
|
Aerik Shipping Company Inc.
|
Marshall Islands
|
Pulap Shipping Company Inc.
|
Marshall Islands
|
Bokak Shipping Company Inc.
|
Marshall Islands
|
Makur Shipping Company Inc.
|
Marshall Islands
|
Jabat Shipping Company Inc.
|
Marshall Islands
|
Fayo Shipping Company Inc.
|
Marshall Islands
|
Weno Shipping Company Inc.
|
Marshall Islands
|
Lelu Shipping Company Inc.
|
Marshall Islands
|
Houk Shipping Company Inc.
|
Marshall Islands
|
Ujae Shipping Company Inc.
|
Marshall Islands
|
Rairok Shipping Company Inc.
|
Marshall Islands
|
Toku Shipping Company Inc.
|
Marshall Islands
|
Kaben Shipping Company Inc.
|
Marshall Islands
|
Wake Shipping Company Inc.
|
Marshall Islands
|
Taroa Shipping Company Inc.
|
Marshall Islands
|
Husky Trading, S.A.
|
Panama
|
Buenos Aires Compania Armadora S.A.
|
Panama
|
Changame Compania Armadora S.A.
|
Panama
|
Chorrera Compania Armadora S.A.
|
Panama
|
Cypres Enterprises Corp.
|
Panama
|
Darien Compania Armadora S.A.
|
Panama
|
Diana Shipping Services S.A.
|
Panama
|
Eaton Marine S.A.
|
Panama
|
Panama Compania Armadora S.A.
|
Panama
|
Skyvan Shipping Company S.A.
|
Panama
|
Texford Maritime S.A.
|
Panama
|
Urbina Bay Trading, S.A.
|
Panama
|
Vesta Commercial, S.A.
|
Panama
|
Marfort Navigation Company Limited
|
Cyprus
|
Silver Chandra Shipping Company Limited
|
Cyprus
|
Bulk Carriers (USA) LLC
|
United States (Delaware)
|
1. |
I have reviewed this annual report on Form 20-F of Diana Shipping Inc. (the "Company");
|
2. |
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3. |
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the Company as of, and for, the periods presented in this report;
|
4. |
The Company's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Company and have:
|
(a) |
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Company, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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(b) |
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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(c) |
Evaluated the effectiveness of the Company's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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(d) |
Disclosed in this report any change in the Company's internal control over financial reporting that occurred during the period covered by the annual report that has materially affected, or is reasonably likely to materially affect, the Company's internal control over financial reporting; and
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5. |
The Company's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Company's auditors and the audit committee of the Company's board of directors (or persons performing the equivalent functions):
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(a) |
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Company's ability to record, process, summarize and report financial information; and
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(b) |
Any fraud, whether or not material, that involves management or other employees who have a significant role in the Company's internal control over financial reporting.
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1. |
I have reviewed this annual report on Form 20-F of Diana Shipping Inc. (the "Company");
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2. |
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3. |
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the Company as of, and for, the periods presented in this report;
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4. |
The Company's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Company and have:
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(a) |
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Company, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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(b) |
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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(c) |
Evaluated the effectiveness of the Company's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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(d) |
Disclosed in this report any change in the Company's internal control over financial reporting that occurred during the period covered by the annual report that has materially affected, or is reasonably likely to materially affect, the Company's internal control over financial reporting; and
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5. |
The Company's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Company's auditors and the audit committee of the Company's board of directors (or persons performing the equivalent functions):
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(a) |
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Company's ability to record, process, summarize and report financial information; and
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(b) |
Any fraud, whether or not material, that involves management or other employees who have a significant role in the Company's internal control over financial reporting.
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1. |
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
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2. |
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
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1. |
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
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2. |
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
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